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3 Best Country ETFs of 1H That Survived the Pandemic

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The COVID-19 pandemic has taken a toll on stocks around the globe in the first half due to lockdowns that forced people to stay indoors to contain the spread, putting the economies of many nations at risk.  

However, global stocks recovered most of the losses incurred from the pandemic thanks to massive stimulus and reopening of the economy, which has resumed business activities. Strong assurances by central banks that more stimuli will be available to counter the worst global downturn since the 1930s have bolstered investors’ confidence (read: 5 ETFs That Outshined During 100 Days of Coronavirus Pandemic).

Again, the second wave of coronavirus infection made investors jittery last week given the rising number of case in Brazil, Germany, some U.S. states and other areas. Notably, the MSCI All-Country World Index, which tracks shares across 47 countries, has plunged about 6.8% so far this year.

While most the countries’ stocks have been beaten down badly in the pandemic, some still managed to trade in green for the first half of the year. Below we have highlighted them:

KraneShares MSCI All China Health Care Index ETF (KURE - Free Report) – Up 32.5%

China stocks have performed extremely well overplaying fears of the coronavirus pandemic and reacceleration in U.S. China tensions. The People’s Bank of China has injected $1.7 trillion yuan ($242.9 billion) into the economy in Feb via reverse repos and unexpectedly lowered interest rates on reverse repurchase agreements by 10 basis points (bps). Additionally, the government has unveiled a fiscal stimulus package of nearly 3.6 trillion yuan (US$506 billion) to offset the economic shock caused by the coronavirus pandemic. Most notably, healthcare segment took the lead as the virus has raised the need for healthcare services and medicines.   

KURE offers exposure to Chinese companies engaged in the health care sector, specifically in patent and generic pharmaceuticals, hospital administration, biotechnology, medical equipment production, healthcare IT, and traditional Chinese medicine by tracking the MSCI China All Shares Health Care 10/40 Index. The fund holds 103 stocks in its basket with AUM of $72 million and expense ratio of 0.65%. It trades in average daily volume of 51,000 shares (read: 6 Equity ETFs in Green Last Week Despite Wall Street Bloodbath).

ARK Israel Innovative Technology ETF (IZRL - Free Report) – Up 12.1%

The Bank of Israel carried out a series of quantitative easing measures for the first time since the global financial crisis, buying government bonds of various types and maturities in the open market. As such, Israel stocks showed strength as economic damage from the coronavirus outbreak was less than initially feared.

IZRL follows the ARK Israeli Innovation Index, which measures the performance of companies whose main business operations are causing disruptive innovation in the areas of genomics, health care, biotechnology, industrials, manufacturing, Internet or information technology.

It holds 39 stocks in its basket with AUM of $24.7 million and average trading volume of 8,000 shares. The ETF charges 49 bps in annual fees.

iShares MSCI Denmark ETF (EDEN - Free Report) – Up 7.1%

The Danish stock market has yielded positive returns so far this year driven by European Central Bank’s (ECB) stimulus package. The central bank unveiled a plan to borrow 750 billion euros ($826.5 billion) on the market and then disburse to EU countries, which will include 500 billion euros in grants and 250 billion euros in loans. The ECB also launched an $820 billion coronavirus package in March to help the economy recover from the coronavirus slump (read: Time for Europe ETFs on Stimulus Optimism?).

This ETF follows the MSCI Denmark IMI 25/50 Index, holding 45 securities in its basket. From a sector look, health care takes the largest share at 40.7% while industrials takes 22.2% of assets. It has amassed $51.6 million in its asset base while trades in volume of 15,000 shares a day on average.

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