ETF Research and Analysis

by Patricia Oey
Suitability
IShares MSCI Indonesia Index EIDO provides cap-weighted exposure to Indonesian equities. Indonesian stocks only account for 2% to 3% of the value of the MSCI Emerging Markets Index, so investors can use this fund for additional   Read more 

Bull Case

The IMF forecasts Indonesia to grow in the midsingle digits during the next few years, driven by increases in private consumption and investment.
Indonesia has plentiful natural resources and is well-positioned to benefit from the economic development of its Asian neighbors over the long term.
Most of Indonesia's large-cap companies have a greater focus on its domestic market. As such, Indonesia is less exposed to weakening demand for exports from developed markets, relative to some of its neighbors. Read more 

Bear Case

Economic development in Indonesia is hampered by widespread corruption, its weak legal systems, and its poor infrastructure.
Foreign investors have poured into Indonesia's equity and debt markets during the past two years. A large reversal in flow could negatively affect the local markets and the value of the Indonesian rupiah.
Terrorism, political unrest, and natural disasters (earthquakes) are potential threats to economic development and social stability. Read more 

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Stalled Financials Offer a Bit of Value 
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