ETF Talk: The Pacific Rim Offers Opportunity beyond Japan

Doug Fabian

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

Sixty percent of the world’s population lives in Asia, but less than two percent of human beings live in Japan. With those population numbers in mind, you may want to focus your investments on some non-Japanese equities in the Pacific Rim that are tied to other developed economies in the region. One way to do so is through the iShares MSCI Pacific ex-Japan Fund (EPP).

This fund seeks results which, before fees and expenses, replicate the performance of an index of stocks from four countries: Australia, Hong Kong, New Zealand and Singapore.

EPP has notched a gain of 4% so far this year, following last year’s 22% jump. The yield of 4.74% offers another reason to own the fund. As the global market situation improves, so should the markets in the Pacific Rim, which this ETF is poised to tap.


The fund’s holdings in Australia, Hong Kong, New Zealand and Singapore allow investors to diversify their exposure in Asia, while avoiding Japan’s traditionally anemic growth. The top sectors in this fund are financial services, 39%; real estate, 14%; and basic materials, 11%. Other holdings in the fund are industrials, consumer cyclical, consumer defensive, utilities, energy, communication services, healthcare and technology.

EPP’s top 10 individually held companies comprise 40.56% of its assets. The five biggest individual company holdings are Commonwealth Bank of Australia, 7.02%; BHP Billiton Ltd, 6.36%; Westpac Banking Corporation, 5.65%; Australia and New Zealand Banking Group Limited, 4.86%; and National Australia Bank Ltd., 4.50%.

While Asian investment stories tend to focus on Japan or developing economies like China, there’s huge potential upside to the Pacific Rim’s other developed economies, where business cultures that respect the rule of law and global business practices make it profitable to cater to Western-style consumer demands.

If you want my advice about buying and selling specific ETFs, including appropriate stop losses, please consider subscribing to my Successful Investing newsletter. As always, I am happy to answer any of your questions about ETFs, so do not hesitate to email me by clicking here. You may see your question answered in a future ETF Talk.

share on:
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 PRO (exclusively for subscribers of Cash Machine)
  • Quick Income Trader
  • Breakout Options 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
  • High Velocity Options
  • Intelligence Report
  • Bullseye Stock Trader
  • Eagle Eye Opener

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
  • Stock of the Week
  • Technical Traders Alert
  • Rapid Profits Stock Trader

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