EWL: Why This Fund Will Likely Lag Broader International Funds
iShares MSCI Switzerland ETF receives a Hold rating due to its mixed outlook versus broader international peers and less attractive valuation. EWL's top holdings—Nestle, Novartis, and Roche—offer stability and dividend growth but lag behind the growth of global tech leaders in VXUS. EWL has higher fees (0.50%) and a lower dividend yield compared to peer funds like VXUS, which also boasts greater diversification and lower costs.
EWL: Buy Swiss, Invest Globally
EWL offers exposure to Switzerland's resilient economy, with a focus on defensive, high-quality multinationals like Nestlé, Roche, and Novartis. The fund's concentrated portfolio is balanced by sector diversification and the global reach of its top holdings, supporting steady medium-term returns. EWL's expense ratio is reasonable given its liquidity and BlackRock's reputation, though dividend yield could be higher compared to peers.
EWL: Swiss Stocks Are Expensive, But They're High Quality Compounders
iShares MSCI Switzerland ETF (EWL) offers a stake in high-quality companies in a uniquely stable and decentralized nation. The ETF is quite concentrated, with the top three and top ten holdings accounting for 40% and 66% of assets, respectively. EWL benefits from the Swiss Franc's historical and ongoing outperformance against the U.S. dollar, enhancing long-term returns.
EWL: A More Political Stable, But Too Expensive Alternative To The U.S.
Switzerland offers a stable investment environment with solid economic data, low inflation, and a healthy labor market. The iShares MSCI Switzerland ETF is expensive with a P/E ratio of 21.18 and a P/B ratio of 3.31, almost similar to the S&P 500. EWL's high allocation to Nestle, Roche, and Novartis poses diversification risks, and their low growth rates do not justify the ETF's high valuation.
EWL: Quality Swiss Blue Chips At A Fair Price
The iShares MSCI Switzerland ETF offers investors exposure to stocks listed in Switzerland. Like many country-specific funds, this ETF is very top-heavy. Sector concentration is also significant. Although this isn't a factor-based fund, its target index consists of companies that sport very high-quality earnings.
EWL: Switzerland Stocks Not Cheap Enough
A valuation gap exists between US and European equities, with European stocks, including Swiss equities, being significantly cheaper even after accounting for sector differences. I have a hold rating on the iShares MSCI Switzerland ETF due to its higher P/E ratio and recent bearish trends in the healthcare sector. EWL's technical situation is concerning, with support levels at $45 and $41.50–42.00 suggesting buying on dips rather than at current prices.
EWL ETF: Advisable To Take Some Profits Now (Rating Downgrade)
The iShares MSCI Switzerland ETF (EWL), an established low-churn ETF covering 46 Swiss stocks has done reasonably well over the past 10 months generating returns of 22%. We are now revising our rating on EWL from a BUY to a HOLD on account of subdued macros and potential FX volatility. EWL's top holding is Nestle with a 16% weighting, but it is undergoing top management churn and could see a directional pivot as new management seeks to frontload one-time costs.
EWL: Slower Growth Relative To The S&P 500 Index
iShares MSCI Switzerland ETF has underperformed the S&P 500 index due to low exposure to growth sectors. EWL's sector allocation is heavily weighted towards defensive sectors, while growth sectors have minimal representation. Switzerland's manufacturing PMI has shown signs of improvement, but the direction of the services sector is uncertain.
