Indonesia's Party May Not Be Over
These are halcyon days for Indonesia's stock market and the corresponding ETF's that trade here in the U.S. There's really no other way to say it: The world's fourth-largest country by population has an economy and stock market that are on fire.
The Jakarta Composite Index touched a record high last week and the good times look poised to keep on rolling. The index's moving average convergence divergence graph, or MACD, on Aug. 19 crossed the nine-day exponential moving average line from below, indicating the rally is sustainable, Bloomberg News reported, citing an Indonesian technical analyst.
Future gains would come on top of the 23% the index has already gained this year. Foreign investors have plowed $275 million into Indonesian stocks this month alone, according to Bloomberg.
All of this makes for excellent news for the iShares MSCI Indonesia Invstable Market Index Fund (NYSE: EIDO). Minted on May 7, EIDO has surged 20% since its debut while the S&P 500 is flat in that time.
If EIDO's light volume (less than 13,000 shares a day) scares you off, run over to the Market Vectors Indonesia ETF (NYSE: IDX), the veteran of the Indonesia-specific ETF world. IDX is also up 20% since May 7 and makes new 52-week highs on an almost daily basis.
It's hard to go wrong with either ETF, but remember that neither is optionable. At the same time, don't forget that only two Asian markets are officially in bull market territory. Indonesia is one, Thailand is the other.
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