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Put This Tiny Island On Your ETF Watch List

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T he Emerald Isle has lived up to one of its mottoes for ETF investors: "Erin go bragh" -- that's Irish for "Ireland forever." TheiShares MSCI Ireland Capped ( EIRL ) is up 20% year to date through Dec. 21, putting it ahead of all international stock exchange traded funds tracked by IBD, except for a couple holding China stocks.

EIRL produced an annual average gain of 20.7% over the past three years and 17.3% over the past five years. It outpaced virtually every international ETF in those periods.

By comparison, the bellwether iShares MSCI EAFE ( EFA ), holding foreign developed market stocks, has stumbled 2% year to date. This ETF gained an annual average 3.9% over the last three years and 3.3% over the last five.

EIRL holds $168.5 million in assets and has a 0.48% expense ratio.

EFA has $58.18 billion in assets and a 0.33% expense ratio.

Irish stocks often feature on IBD's Global Leaders, a list of top-notch world stocks. These are companies that rate highly on earnings and sales growth, price momentum and return on equity, among other metrics.

The EIRL portfolio has big stakes in budget airlinerRyanair ( RYAAY ) and outsourced drug developerIcon ( ICLR ).

Ryanair has an IBD Composite Rating of 95 out of a best-possible 99. It's a leader in providing cheap fares for budget travel, mostly in Europe.

The stock is up roughly 21% year to date.

Icon provides outsourced development services to pharmaceutical, biotechnology and medical device companies in Ireland, the rest of Europe, and the United States among other markets. It has longer-term deals with some of the largest drug makers.

This top-rated IBD 50 stock is up 47% year to date.

Fleetmatics ( FLTX ) is another Irish stock, though not held by EIRL.

It is also an IBD Global Leader. Fleetmatics provides software solutions for commercial fleet management companies.

The stock is up 42% so far in 2015.

Investors can use EIRL as a high-risk, high-reward play for successful investing .

But its concentrated 24- stock portfolio loses some of the diversification benefits offered by EFA, its larger and more popular ETF sibling holding developed-market EAFE (Europe, Australasia and the Far East) stocks.

EIRL is also top-heavy, concentrating 75% of portfolio assets in the top-10 stock holdings.

Both EIRL and EFA saw net inflow of money over the first 11 months of 2015.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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