) has long been known for its technological capacity and
innovation. It should come as little surprise that this dynamic
economy is a major player in the smartphone space.
[caption id="attachment_54737" align="alignright" width="220"
Taiwan is unique among emerging markets in the sense that
technology forms the backbone of its economy. With the possible
exception of South Korea (
, no emerging market benefits from the smartphone revolution and as
much and in as many different ways as Taiwan.
Taiwanese companies represent disparate segments of the value
chain and elements of the supply chain. HonHai Precision
Industries, better known globally as Foxconn, is responsible for
the assembly of myriad smartphones and tablets, including Apple (
) iPhones and iPads; Mediatek and Taiwan Semiconductor (
) supply chip components for smartphones; HTC manufactures sleek,
state-of-the-art smartphones and tablets.
With the exception of Taiwan Semi, the other Taiwan-based
companies listed above don't trade on U.S. exchanges. However,
investors can still gain exposure to a basket of Taiwanese
technology firms through the iShares MSCI Taiwan Index ETF. The EWT
has a 56% weighting to the tech sector.
As a result, the ETF is often employed a tech proxy.
For investors looking to jump in, the EWT is in somewhat of a
no-man's land. It's down roughly 10% from its highs last year, but
up 15% from its late-fall lows. Technically, EWT is still trading
above its 50, 100, and 200-day moving averages, but a recent
bearish crossover of the 50 and 200 day could see the stock move
Traders should watch for EWT's reaction at the 13.17-13.25
level, where the 200 and 50-day moving averages are located,
respectively. Strong support here could see the EWT move higher;
conversely, a failure to hold these levels could see this ETF test
its 100-day moving average around 12.67.
EWT traded down .45% on Monday to 13.37.