Why I Still Recommend Buying the iShares MSCI Poland ETF (EPOL)
Despite the ongoing market volatility, I believe that the iShares MSCI Poland ETF (EPOL) remains an attractive investment opportunity. Let me explain why.
Strong YTD Performance
First and foremost, EPOL has delivered impressive year-to-date (YTD) performance. As of now, the ETF is up by over 20%, making it one of the best performing European ETFs in 2023. This solid performance can be attributed to various factors, including Poland’s robust economy and attractive valuations.
Value Proposition: Assets Under Management and Dividend Yield
Another compelling reason to consider EPOL is its value proposition. The ETF has experienced a significant increase in assets under management (AUM), which now stands at over $1.5 billion. This growth indicates strong investor demand for Polish equities and underscores the country’s growing importance in the global investment landscape.
Furthermore, EPOL offers a high dividend yield, which currently stands at around 4.5%. This yield is attractive, especially in today’s low-interest-rate environment. The majority of the dividends paid by the companies in EPOL’s portfolio are derived from the financial, industrial, and energy sectors, which are well represented in the ETF.
Solid Value Case: Low P/E Ratio and Limited Tech Exposure
The ETF’s low price-to-earnings (P/E) ratio of 12.5x is another factor that makes it an appealing investment. This ratio is lower than the average P/E ratio for the MSCI Europe Index, suggesting that Polish equities are undervalued. Moreover, EPOL’s limited tech exposure is a welcome feature, as the global selloff in Information Technology stocks continues to weigh on the market.
Impact on Individuals and the World
For individual investors, adding EPOL to a diversified portfolio can help mitigate risk and potentially enhance returns. As a reminder, investing in a single asset class or geographic region can be risky, so it’s essential to maintain a well-diversified portfolio. EPOL provides exposure to a broad range of Polish equities, which can help reduce concentration risk.
At a global level, the strong performance of EPOL and other Polish ETFs is a positive sign for the country’s economy. Poland’s economic growth has been robust in recent years, and the country is considered a bright spot in Europe. As more investors take notice of Poland’s attractive valuations and solid fundamentals, it’s likely that foreign investment in the country will continue to increase.
Conclusion
In conclusion, despite recent market volatility, I still believe that the iShares MSCI Poland ETF (EPOL) is a worthwhile investment. Its strong YTD performance, value proposition, and solid fundamentals make it an attractive option for both individual investors and institutional investors. Additionally, the positive impact of EPOL’s performance on Poland’s economy is an encouraging sign for the future.
- EPOL has delivered impressive YTD performance, making it one of the best performing European ETFs in 2023
- The ETF offers exposure to a broad range of Polish equities and a high dividend yield
- EPOL’s low P/E ratio and limited tech exposure provide a solid value case
- Individual investors can benefit from adding EPOL to a diversified portfolio
- EPOL’s strong performance is a positive sign for Poland’s economy
