Invest in Poland with Polish ETFs
If your investing strategy targets companies that are either located in Poland or conduct the majority of their business within the country, then you should look into Polish ETFs. Whether you are trying to diversify your portfolio, hedge risk correlating with Poland, or capitalize on an investment opportunity based on news related to Poland, then ETFs might be an efficient way to execute your strategy.
Instead of trying to corner the market on Poland company stocks, or battle the pricing and commissions of filling a Polish index basket, you can gain instant access to the Poland market with a Polish ETF. Not only does it make your transaction process a little easier, but you can actually save on commissions and fees with ETFs. And ETFs come with many advantages as well, including the tax benefits.
However, one downside to Poland ETFs is the lack of diversity and volume. Unfortunately, there are only two exchange-traded funds on the market that focus on Poland, so your choices are a bit limited. Hopefully, that will change over the course of time and when it does, I will make sure to update this list with the new funds (or remove any funds that are delisted), but in the meantime, here is the short list of your Poland ETFs.
List of Poland ETFs
- EPOL - iShares MSCI Poland Investable Market Index Fund
This Poland ETF correlates with the MSCI Poland IMI 25/50 Index and both the fund and the benchmark include companies that trade on that trade on the stock exchanges in Poland. Some of those company stocks include PKO Bank Polski, Powszechny Zakland Ubezpiecze, Bank Pekao, and KGHM Polska Miedz.
The fund has been trading since May of 2010 and the top sectors represented in the ETF are financials, energy, materials, and utilities. However, there are stocks from other industries as well such as telecommunications, consumer discretionary and staples, industrials, and information technology. You can get full details about EPOL on the iShares fact sheet.
- PLND - Market Vectors Poland ETF
The other fund on this list of Poland ETFs has similar characteristics to EPOL as both ETFs target companies that trade on the Poland stock exchanges, and are either located in the country or the majority of their business is from Poland. However, PLND does have a different benchmark - Market Vectors Poland Index (MVPLNDTR).
Some of the top holdings in the fund and the index are Pkobp, Pzu, Pekao, Pge, and Kghm. And some of the top sectors represented are Financials, Energy, Utilities, Materials, Consumer Staples and Discretionary, Telecommunication Services, Information Technology, and Industrials.
The fund has been actively trading since November of 2009 and you can get full details for PLND on the Market Vectors fact sheet.
As I said above, I will add ETFs to the list as any new funds are launched, but as for these two existing Poland funds, make sure to research each thoroughly before making any trades. Make sure you understand what is in each fund, how they react to different market conditions and most importantly, make sure you understand the risks associated with each of these ETFs.
And if you have any questions or concerns, be sure to consult a financial professional such as your broker, a financial advisor, or even the ETF providers as well. However, once you feel you've conducted your due diligence, then good luck with all of your trades!
Disclaimer - at the time of publication of this article, I do not have any open positions in any of the above Poland exchange traded products.