Shares of the iShares MSCI Philippines Investable Market Index
Fund (NYSE:
EPHE
), one of 2012's top-performing emerging markets
ETFs
, are off half a percent on Monday and the catalyst behind the
loss might come as a surprise to some investors.
Some might say with the ETF up almost 7.1 percent in the past
month, the fund is now near-term overbought and some traders are
taking profits today. Another reason could be the impact of
Typhoon Bopha, which has
some 1,400 Filipinos dead or missing
. Or it could be a disappointing September foreign direct
investment number that saw the nation's FDI slide 60 percent to
$55 million from $138 million a year earlier.
All would be plausible reasons for EPHE's Monday woes, but in
the case of the FDI, it should be noted that through September
the Philippines has attracted almost $1.1 billion
in FDI this year
, up 40 percent from the same period in 2011.
Believe it or not, a big reason why the lone Philippines ETF
could be trading lower today, and the emphasis should be on
"could be," is Manny Pacquiao's loss to Mexico Juan Manuel
Marquez in a Saturday boxing match.
Pacquiao, simply put, is the most famous athlete in
Philippines history and is revered in his home country. And no,
investors should not base their decisions to buy and sell any
security around the outcome of a sporting event, but EPHE
does have an interesting post-Pacquiao fight
track record
.
The Marquez loss on Saturday was Pacquiao's fifth fight since
EPHE debuted in September 2010. He won the first three bouts
after EPHE came to market. In two instances, the ETF was higher
the Friday after Pacquiao victories than it was the Friday before
the fights.
However, it should be noted that Pacquiao lost a fight to Tim
Bradley in June in what many boxing fans believe was a
controversial decision. Some even speculated
the fight was fixed
. EPHE would proceed to trade higher in the days immediately
following the bout.
On the other hand, studies have been conducted regarding how
some global stock exchanges perform in the wake of major
international football (soccer to Americans) matches. The
evidence suggests a loss for a football-crazed nation such as
Italy or Spain
leads to losses for the country's equities on the
next trading day following the match
.
In other words, it is not perfect science, but EPHE trading
lower after a Pacquiao loss is not out of the realm of
possibility, either. One factoid that speaks to more upside ahead
for the ETF is asset growth. Heading into the Pacquiao/Bradley
fight in June, EPHE had about $142 million in assets under
management. Today, that number is over $205 million,
according to iShares data
.
As for the iShares MSCI Mexico Investable Market Index Fund
(NYSE:
EWW
), that ETF is up almost one percent today following the Marquez
victory.
For more on ETFs, click
here
.
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