The AFK ETF aims to Track the MVIS GDP Africa Index, encompassing companies incorporated in Africa or those generating at least 50% of their revenues from the continent. The ETF incurs a relatively high 0.88% cost to gain exposure to ~80 stocks across the region, from South Africa to Morocco and Nigeria, as well as the UK and Canada, which have companies operating predominantly on the continent. Again, this ETF isn’t as mining-focused as many would imagine, although its number one industry group is mining with ~32% of exposure. Over the last year, tracking has been satisfactory, with the ETF up +29.4% compared to the mix of respective indexes at +30.4%, which we consider acceptable given the diverse basket of currency-denominated stocks held in the US-traded ETF.
- We are cautiously bullish on the AFK as it pushes toward fresh 3-year highs.
