Currently, Thailand is in the throes of political turmoil so
serious, it is threatening the economic well-being of the country.
But as the second-argest economy in Southeast Asia, it's hard to
ignore their potential. You can see these competing forces in play
in Thailand's exchange traded fund (
): up 92% on the year, but down 3% in April.
The turmoil plaguing Thailand has been the rise of the red shirt
movement, which has been accused of trying to overthrow Thailand's
reports Seth Mydans for
The New York Times
. In April, red shirt protests led to 25 deaths and more than 800
According to Mydans, the red shirt movement was built on the
political base Thaksin Shinawatra, a former prime minister and
telecom billionaire, created during his tenure. [
An ETF for Singapore's Soaring Growth.
Because of the risk of political upheaval, Fitch downgraded
Thailand's long-term local currency rating from stable to negative,
report Shamim Adam and Dan Ten Kate of
The downgrade "reflects an escalation in political uncertainty,
coupled with a slow economic recovery and a deteriorating policy
environment, all of which are expected to impact adversely on
sovereign creditworthiness over time," said Vincent Ho, associate
director of Fitch's Asia sovereign ratings team.
Countering, Usara Wilaipich, a Bangkok-based economist said,
"Any move by ratings agencies should reflect their concerns about
political risk rather than the fundamentals of the Thai economy."
Thailand opted to do just that, and kept rates where they are while
the unrest plays out.
Thailand's four biggest banks posted robust earnings in the
report Leigh Murray and Piyarat Setthasiriphaiboon
The Wall Street Journal
. Bangkok Bank PCL's first quarter net profit rose 25%, Krung Thai
Bank PCL's earnings rose 16%, Kasikombank PCL's earnings grew 15%,
and Siam Commercial Bank PCL's net profit grew 15%. [
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If the Thailand ETF is one you'd like to own, note that a) it's
above its long-term trend line, although it has dropped sharply
since the crisis began and b) have an exit strategy in place - it's
considered a sell signal if it drops 8% off the recent high or
below the 200-day moving average, whichever comes first. [
How to Follow Trends.
For more stories on Thailand, visit our
iShares MSCI Thailand Invest Mkt Index (NYSEArca:
Sumin Kim contributed to this article.