Bovespa Index Analysis and Related ETFs

Prices, after having fallen towards the end of March to a low of 97,000 points, have made a solid recovery and are now close to 120,500-120,600 points.

The short-term trend is therefore positive, with the main directional indicators in a long position.

Exceeding 120,600 will open up further room for growth, with a first target at 121,600 (opening high of 2022) and a second, more ambitious target near 125,000 points.

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It is difficult for now to hypothesise a bearish trend reversal: however, a descent below 116,500 points is dangerous, as it could trigger a rapid correction and push prices towards the next graphic supports located in the 114,500-114,200 area first and at 112,000-111,800 points later.

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The following ETFs can be used to invest in the Bovespa index (which contains the most important Brazilian equities):

Lyxor MSCI Brazil UCITS, ISIN LU1900066207. This ETF has €495m in assets under management, synthetic replication of the underlying (via swaps), adopts an accumulation policy (with dividends being reinvested within the fund) and is currency unhedged. The total expense ratio (TER) is 0.65% per annum.

iShares MSCI Brazil UCITS, ISIN IE00B0M63516. This ETF has €359m in assets under management, physical replication of the underlying (through the purchase of the securities that make up the index), a distribution policy (with dividends distributed quarterly to investors) and no currency hedging. The total expense ratio (TER) is 0.74% per annum.

Xtrackers MSCI Brazil UCITS, ISIN LU0292109344. This ETF has €70m in assets under management, physical replication of the underlying (through the purchase of securities), adopts an accumulation policy (with dividends being reinvested within the fund) and is not currency hedged. The total expense ratio (TER) is 0.65% per annum.

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