FLLA: Open To Pursuing, But Heightened Brazil Exposure Makes Things Tricky

2025-04-10 16:57:33 ET

Summary

• The Franklin FTSE Latin America ETF (FLLA) which focuses on 140 stocks from Latin America has generated returns of double-digits and outperformed global stocks this year.
• We ascertain how FLLA is positioned relative to its larger peer ILF.
• The growth landscape in Brazil looks weak with benchmark interest rates poised to rise even further.
• FLLA's descending channel is no longer in play as it flattens out, and valuations look very compelling, particularly in light of the earnings potential of its holdings.

A Respectable Start To The Year

The Franklin FTSE Latin America ETF ( FLLA ), a $27 million-sized (in AUM) ETF that covers around 144 stocks from the Latin American region (most of which are large and mid-sized businesses), has done reasonably well this year. On a YTD basis, when global stocks (as represented by the Vanguard Total World Stock ETF) have fallen by almost 5%, FLLA has notched positive returns within the low double-digit threshold....

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