Female Heads of State and ETF Returns: A 2012 Review

By Benzinga.com  DEC 20, 2012 3:10 PM

In 2012, at least 13 women occupied presidencies or premierships across the globe.


Editor's Note: This content was originally published on Benzinga.com by The ETF Professor, Benzinga Staff Writer.

Shares of the iShares MSCI South Korea Index Fund (NYSEARCA:EWY) and the rival First Trust South Korea AlphaDEX Fund (NYSEARCA:FKO) traded higher for most of Wednesday, following news of Park Geun-hye's victory in South Korea's presidential election. Park, the head of the New Frontier Party, will become her country's first female president.

While the US has yet to elect a female president, plenty of other countries have elected women as heads of state. In 2012, there were at least 13 women occupying presidencies or premierships across the globe, according to Time.

Some hail from nations tracked by popular ETFs, giving investors an opportunity to see how equities in those countries perform when a woman is running the show. It is important to note that poor performances by any country ETF cannot be blamed on the sex of that country's president or prime minister. After all, there are plenty of country ETFs that have, at times, struggled under male regimes.

Global X FTSE Argentina 20 ETF (NYSEARCA:ARGT): The dreadful performance of the Global X FTSE Argentina 20 ETF this year, down 15.6%, has nothing to do with the fact that President Cristina Fernandez de Kirchner is a woman. Rather, ARGT's slack performance has everything to do with Kirchner's anti-free market principles and penchant for nationalizing industries.

That ideology has brought Argentina to the brink of its second sovereign debt default this century.

iShares MSCI Germany Index Fund (NYSEARCA:EWG): As the top elected official in the eurozone's largest economy, German Chancellor Angela Merkel has played an often controversial role in the region's efforts to escape one of history's worst sovereign debt crises. Merkel's heavy-handed approach to austerity measures means she probably is not the most beloved politician in Greece or Spain, but those are not the countries where she has to solicit votes.

From a pure performance standpoint, it is impossible to argue with how German equities have performed this year. The DAX is one of the world's top-performing major bourses while the iShares MSCI Germany Index Fund has surged almost 32%.

iShares MSCI Brazil Index Fund (NYSEARCA:EWZ): Brazil has been the laggard of the BRIC quartet this year, meaning EWZ has been the laggard of the four major ETFs tracking the BRIC nations. In fact, EWZ is the only currently sporting a year-to-date loss. That said, EWZ has perked up in recent weeks and it could rally enough over the next few days to finish the year modestly to the upside. Many of EWZ's woes could be pinned on Petrobras (NYSE:PBR), the ETF's largest holding. Petrobras is Brazil's state-run oil producer and the government is the company's largest shareholder, meaning Brazilian President Dilma Rousseff often endures criticism for that stock's slump. In fairness to her, Petrobras was problematic before she took office.

Despite low interest rates and a variety of stimulus efforts, Brazil's economy is projected to grow at a rate below 2% this year. Economists are forecasting growth of just 3% next year.

In the US, a slack economy would put a sitting president in danger of not winning reelection. At the very least, it would lead to some poor approval ratings. Rousseff has defied those odds. Her approval has actually jumped slightly in the past 90 days and currently rests at an amazing 78%, according to Reuters.

iShares MSCI Thailand Investable Market Index Fund (NYSEARCA:THD): South Korea's Park will not be the only woman to be an Asian nation's top elected official. Thai Prime Minister Yingluck Shinawatra is one of the others and when it comes to economic and equity performance, it appears that she is doing a fine job.

On Wednesday, the World Bank boosted its growth forecast for Thailand's 2012 GDP growth to 4.7% from 4.5% while forecasting 2013 growth of 5%. Amid contracting eurozone economies, a prime destination for Thai exports, Thailand's economy has proven resilient and inflation is tame at 3%.

Economists and political pundits can debate how much credit Shinawatra deserves, but there is no debating the fact that the iShares MSCI Thailand Investable Market Index Fund has surged 34.4% this year.

The Diamond Engagement Ring: Necessary Expense Or High Value Investment?

Bill Ackman Lays Out Herbalife Short Case

Apple to Ship 12 Million iPad Mini Units Before 2013

Twitter: @Benzinga

Benzinga Pro covers this and all market news in real time. Get your free trial here
No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.