Brazil: Dragging Down EM Americas Performance

February 14, 2023
By Knowledge Leaders Team in Markets

Last week I looked at how Canadian stocks underperformed US stocks this year, decomposing North American Performance. This week I take a look at EM Americas performance.

First, I look at the Mid-Large EM Americas universe, which includes the top 85% of stocks for market cap in each country, reduced by the 50% least liquid companies. In this analysis, we also ignore frontier American countries like Peru and Argentina. This results in 172 stocks from Mexico, Brazil, and Chile.

Number of EM Americas Stocks:

Brazil has the most companies, representing over 50% of all companies in our EM Americas universe.

Number of Brazilian Stocks:

Number of Mexico Stocks:

Number of Chile Stocks:

Year-to-date, these EM Americas stocks, on an equal cap-weighted basis, have underperformed stocks from DM Americas by 0.57%, returning 7.67% compared with 8.24% for the DM Americas.

EM Americas Performance Year to Date:

DM Americas Performance Year to Date:

On average it looks like EM Americas have done worse than DM Americas (Canada and the United States). However, this is really due to Brazil’s dramatic underperformance when one keeps in mind that it represents over 50% of the EM Americas universe.

Brazil Stocks Performance Year to Date:

While EM Americas stocks have slightly underperformed those in DM Americas countries year-to-date, this average hides a huge disparity between the countries in this group. In fact Chile and Mexico massively outperformed DM Americas year-to-date, while Brazil dramatically underperformed, dragging down the group as a whole so far this year.


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