- The iShares MSCI Thailand ETF (THD) is a broadly diversified single country emerging market ETF
- THD has a good but relatively short performance history; inception date March 26, 2008
- Thailand is still considered an emerging market economy, but it has consistently improved living and economic conditions since the 1980’s
- Thailand is the 50th largest country and the 21st most populous
- Thailand is currently ranked 20th by GDP
- Thailand is ranked 53rd in the Heritage.org Economic Freedom index
THD vs SPY: March 28, 2008 – January 6, 2019
Source: https://www.koyfin.com/home
THD vs S&P 500 index fund: May 2008 – December 2018
Source: https://www.portfoliovisualizer.com/
The iShares MSCI Thailand ETF (THD) was created in March 2018. It is a broadly diversified single-country fund which holds 121 companies in the portfolio. Since its’ inception THD has performed about as well as an S&P 500 index fund. Though this is a relatively short period for comparison, THDs’ performance is compelling since its’ correlation to U.S. Markets is low at 0.64. For investors looking to diversify outside the U.S., this ETF has the potential to add that diversification without degrading overall portfolio performance.
Thailand has long been considered an emerging market economy. But Thailand has made great economic and social progress over the last four decades. Here’s an excerpt from a recent report by WorldBank.org that explains this progress:
“Over the last four decades, Thailand has made remarkable progress in social and economic development, moving from a low-income country to an upper-income country in less than a generation. As such, Thailand has been one of the widely cited development success stories, with sustained strong growth and impressive poverty reduction, particularly in the 1980s.”
“Thailand’s economy grew at an average annual rate of 7.5% in the boom years of 1960 to 1996 and 5% following the Asian Financial Crisis during 1999-2005, creating millions of jobs that helped pull millions of people out of poverty. Gains along multiple dimensions of welfare have been impressive: more children are now getting more years of education, and virtually everyone is now covered by health insurance while other forms of social security have expanded. After average growth slowed to 3.5% over 2005-2015, with a dip to 2.3 % in 2014-2016, Thailand is now on the path to recovery. Economic growth reached 4.8% in the first quarter of 2018 – the highest pace since 2013.”
Wikipedia currently shows Thailand as the world’s 50th largest country by total area and the 21st-most-populous country. Gross Domestic Product, GDP rank 26th (nominal) / 20th (PPP).
The Heritage Foundation has ranked Thailand 53rd in its’ 2018 Index of Economic Freedom.
An important part of investing due-diligence is knowing what you are investing in prior to making the investment. So, let’s look at some of the key facts and characteristics of the THD ETF.
- Objective – The iShares MSCI Thailand ETF seeks to track the investment results of a broad-based index composed of Thai equities. Exposure to a broad range of companies in Thailand. Targeted access to Thai stocks. Use to express a single country view
- Expense ratio – 0.59%
- Number of holdings – 121
- Net assets – $484M
- Average daily volume – 237,000 shares/day
- 12m Trailing Yield – 2.50%
- P/B ratio – 1.78 from Morningstar.com
- P/E ratio – 12.92 from ETFdb.com
THD Top 10 Holdings:
THD Sector Exposure:
Source: https://www.ishares.com/us/products/239688/ishares-msci-thailand-capped-etf
My intent with articles on single-country ETFs is to provide knowledge about investing opportunities. Single-country ETFs can be much more volatile than broad-based regional or foreign asset class ETFs. Investors interested in reducing volatility should consider an Emerging Markets ETF such as DEM or DGS to gain exposure to Thailand. Investors looking to diversify with single-country ETFs may want to consider the iShares MSCI Thailand ETF (THD). It has a short 10-year history, but in that 10 years THD has had good performance and offers relatively low correlation to U.S. Markets. As for this Deep Value ETF Accumulator, I believe that the Thailand ETF risk profile is in line with its’ potential reward of ownership.
Thank you for taking time to read this article. If you found it useful, please share it with a friend.
Respectfully yours, Micah McDonald, aka the Deep Value ETF Accumulator
Disclosure: We intend to buy shares of THD in the future. I am not a professional investment advisor. Please perform your own due diligence or seek assistance from a Registered Investment Advisor prior to investing in any fund mentioned in this article.