Thanks to instability in China that led to repercussion of gloom and uncertainty regarding the timing of an interest rates hike, the global stock market saw a bloodbath in Q3. This is especially true as iShares MSCI ACWI ETF (ACWI) targeting the global stock market tumbled over 9% in the three months through September. This represents the worst quarter since 2011 (see: all the World ETFs here).

The weakness in oil prices, and slowdown in emerging markets and other developed economies further added to the chaos. In fact, the global stocks wiped out nearly $11 trillion in value during the third quarter, according to Bloomberg, suggesting that the pain were felt across every corner of the globe.

Emerging markets were the hardest hit, followed by Asia Pacific and Japan. Meanwhile, European stocks suffered the worst performance since the Euro zone debt crisis in 2011 due to additional headwinds including the Volkswagen scandal, the ongoing Greece glitches and the immigration crisis (read: ETFs to Watch as Emerging Market Asset Outflow Doubles).

However, the negative sentiments seem to be reversing with the start of the fourth quarter as global stocks have shown an impressive comeback in the wake of fresh signs of monetary easing speculation. In particular, slowing growth in China, Japan, Germany and the U.K. have spurred the stimulus bets while the weak U.S. job reports signaled that the era of loose money policy, which has long been supporting the rally in the stock market, would in place for longer than expected.

Further, the latest Fed minutes from the September FOMC meeting pushed back the chances of the rates hike to early next year. Oil price has also regained momentum and has been trending higher on improving demand/supply dynamics, resulting in a global energy sector rally. All these moves have injected fresh optimism into the global stock market at least for the near term and renewed the appeal for the riskier assets. As a result, the global stocks are on track to post their biggest weekly rise in four years (read: ETFs that Gained & Lost Post Dismal Job Data).

That being said, we have highlighted four nations and their ETFs that gained in double digits to start Q4 and are easily crushing the broad U.S. market returns. These could be strong momentum plays for investors heading into the final quarter of the year as well.

Indonesia - Market Vectors Indonesia ETF (IDX)

This ETF follows the Market Vectors Indonesia Index, holding a basket of about 48 companies that are based on or do most of their business in this Southeast Asian nation. The product puts about 53.2% of total assets in the top 10 holdings, suggesting moderate concentration. Large caps are pretty prevalent, as these make up for 76% of assets, leaving little allocation for mid- and small-cap stocks.

With respect to sector holdings, financials takes the largest share at 33.5%, followed by consumer staples (17.8%) and consumer discretionary (13.8%). The product has amassed $87 million in its asset base while trades in moderate volume of around 82,000 shares. It charges 58 bps in fees per year from investors. The fund surged about 19% since the start of Q4 and has a Zacks ETF Rank of 3 or ‘Hold’ rating with a High risk outlook.

Canada - IQ Canada Small Cap ETF (CNDA)

This fund provides exposure to the small-cap segment of the Chinese equity market by tracking the IQ Canada Small Cap Index. Holding 101 stocks in its basket, it does a decent job of spreading out assets, as each security holds less than 3% share. However, it is a bit concentrated from a sector look as energy and materials take the top two positions at 26% and 24%, respectively, while industrials and consumer discretionary round off to the next two spots at 12% and 14%, respectively.

It is unpopular and illiquid having AUM of $8.2 million and average daily volume of 2,000 shares. Expense ratio came in at 0.69%. CNDA gained 17% in the same time period and has a Zacks ETF Rank of 4 or ‘Sell’ rating with a Medium risk outlook (read: Should You Buy Canada ETFs on the Cheap?).

Colombia - Global X MSCI Colombia ETF (GXG)

This ETF is the most popular way to play the country by tracking the MSCI All Colombia Capped Index. In total, the fund holds 29 securities with heavy concentration on the top three firms that combine to make up for 34% share. Other firms hold less than 4.8% of assets in the basket. From a sector look, financials takes the top spot at 40%, while materials, utilities and energy round off the top three positions with a double-digit exposure each. However, the product is well diversified across various market spectrums.

The ETF has so far managed assets worth $68.6 million while charging investors 61 bps a year in fees. Volume is moderate as it exchanges about 179,000 shares in hand per day. The fund is up 14.5% over the past few trading sessions and has a Zacks ETF Rank of 4 with a Medium risk outlook.

Brazil - iShares MSCI Brazil Capped ETF (EWZ)

This product follows the MSCI Brazil 25/50 Index and is the largest and most popular ETF in the space with AUM of over $2 billion and average daily volume of more than 16.7 million shares. It focuses mostly on large cap stocks and charges 62 bps in fees per year from investors. Holding 69 stocks in its basket, the fund is highly concentrated on its top two holdings with one-fifth of the portfolio invested in them. Other firms hold no more than 6.67% of assets (read: S&P Downgrades Brazil to Junk: ETFs in Focus).

In terms of industrial exposure, financials dominate the fund’s return at 31.7%, followed by consumer staples (21.8%), materials (11.4%) and energy (10.3%). The fund added nearly 14.8% since the start of the final quarter and has a Zacks ETF Rank of 4 with a High risk outlook.

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ISHRS-MSCI ACWI (ACWI): ETF Research Reports
 
MKT VEC-INDONES (IDX): ETF Research Reports
 
IQ-CANADA SC (CNDA): ETF Research Reports
 
GLBL-X/F COL 20 (GXG): ETF Research Reports
 
ISHARS-BRAZIL (EWZ): ETF Research Reports
 
SPDR-SP 500 TR (SPY): ETF Research Reports
 
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