Fund Offers Exposure to Africa

Doug Fabian

Doug Fabian is known for his expert knowledge of ETFs, bear funds and enhanced index funds to profit in any market climate.

As we round out our list of regional emerging markets exchange-traded funds (ETFs), this article features VanEck Vectors Africa Index ETF (AFK), a fund that tracks many Africa-based companies and invests most of its $68 million total assets in those companies.

Africa likely is a relatively untapped region for most investors, even though it offers vast commodity resources and growth potential. In fact, as far as ETFs go, AFK is almost the sole choice for broad, pure-play African coverage.

ARK offers one-stop access to a broad range of sectors and African countries, including exposure to some less traditional markets. The fund screens both local listings of companies that are incorporated in Africa, as well as companies outside of Africa that generate at least 50% of their revenues within that continent.

AFK’s index focuses on Gross Domestic Product (GDP), rather than market cap like many other emerging market ETFs. This puts an emphasis on the economic well-being of the country where a selected company is based. As a result, small- and medium-capitalization public companies often are included in the fund.

Year to date, AFK has enjoyed moderate success, with an 11.91% return versus the S&P 500’s 5.48%. Even though the fund is diversified, in the sense that it stretches over many sectors and firms, it is considered relatively high-risk due to the large number of small- and medium-caps in its holdings and the less politically stable nature of Africa compared to other regions. As you can see in the following chart, the fund has managed a small positive overall trend, but not without frequent ups and downs. AFK has a dividend yield of 1.89% and an expense ratio of 0.79%.

Exclusive  Strong Dollar Will Fuel Strong Rally in Russell 2000


View the current price, volume, performance and top 10 holdings of AFK at

The fund’s top five holdings are: Commercial International Bank (Egypt) SAE GDR, 7.92%; Naspers Ltd Class N, 7.42%; Guaranty Trust Bank PLC, 5.21%; Nigerian Breweries PLC, 4.65%; and Safaricom Ltd, 4.20%. AFK has 37.5% of its assets in the financial sector, 14.6% in materials, 11.7% in telecommunication services and 12% in consumer luxury goods. All of these sectors could flourish with strong growth of Africa’s economies.

If you want one-stop access to growing Africa-based companies and you believe in the strength of African economies in the long-run, consider looking into VanEck Vectors Africa Index ETF (AFK) as a possible future addition to your portfolio.

As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an email. You just may see your question answered in a future ETF Talk.

share on:
previous article

Economist Dr. Mark Skousen discusses the impact Trump's victory in the American election may have on the market.

share on:


Dr. Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen is a professional economist, investment expert, university professor, and author of more than 25 books.

Product Details

  • Forecasts & Strategies
  • Home Run Trader
  • Fast Money Alert
  • Five Star Trader
  • TNT Trader

Bryan Perry

A former Wall Street financial advisor with three decades' experience, Bryan Perry focuses his efforts on high-yield income investing and quick-hitting options plays.

Product Details

  • Cash Machine
  • Premium Income (exclusively for subscribers of Cash Machine)
  • Quick Income Trader
  • Breakout Profits Alert
  • Hi-Tech Trader

Jim Woods

Jim Woods has over 20 years of experience in the markets from working as a stockbroker,
financial journalist, and money manager. As well as a book author and regular contributor to
numerous investment websites, Jim is the editor of:

Product Details

  • Successful Investing
  • Intelligence Report
  • Bullseye Stock Trader

Bob Carlson

Bob Carlson provides independent, objective research covering all the financial issues of retirement and retirement planning. In addition, Bob serves as Chairman of the Board of Trustees of the Fairfax County (VA) Employees’ Retirement System, which has over $2.8 billion in assets.

Product Details

  • Retirement Watch
  • Retirement Watch Spotlight Series
  • Lifetime Retirement Protection Program

Jon Johnson

Jon Johnson's philosophy in investing and trading is to take what the market gives you regardless if that is to the upside or downside. For the past 21 years, Jon has helped thousands of clients gain success in the financial markets through his newsletters and education services:

Product Details

  • Investment House Daily
  • Technical Traders Alert
  • Success Trading Group

Used by financial advisors and individual investors all over the world, is the premier provider and one-stop shop for dividend information and research.

Product Details

Popular tools include our proprietary Dividend Calendar, Dividend Calculator, Dividend Score Card, and many more.

  • Dividend Investor