Direxion Daily MSCI Brazil Bull 3X ETF (BRZU)
BRZU Price and Sentiment
BRZU Latest news
Brazilian assets have underperformed since the end of the second quarter, with weakness across all asset classes: FX, credit and rates. In credit, Brazil has widened a bit more than comparable stable BBs in Latin America since June.
The strength of emerging markets (EM) is typically tied to their currencies, and that's exactly what's happening with Brazil's real, making way for gains in the Direxion Daily MSCI Brazil Bull 3X ETF (BRZU). “Brazil's real is now at a more ‘favorable' level and is likely to strengthen much further, Economy Minister Paulo Guedes said [.
Economic re-opening plays need not be relegated to the United States. Brazil is rebounding amid a global vaccine deployment, leading the Direxion Daily MSCI Brazil Bull 2X ETF (BRZU) up 18% for the year.
Wall Street was upbeat last week with the S&P 500, the Dow Jones, the Nasdaq Composite and the Russell 2000 adding 0.6%, 0.7%, 0.5% and 0.8%, respectively.
Brazil Won't Be Dancing To Samba This Year
ETF investors looking for a single-country opportunity can consider Latin America's largest economy: Brazil. For traders seeking to lever up profitability with double exposure, there's the Direxion Daily MSCI Brazil Bull 3X ETF (BRZU).
Apart from the dramatic health implications, COVID-19 will also scar the Brazilian economy, including through a jump in its already high public-sector debt-to-GDP ratio in 2020. We depict different scenarios for GDP growth-cum-debt encompassing not only the short-term trajectory of the Brazilian economy (2020-22), but also different perspectives related to 2023-30.
BRZU is trading at $63 and I believe it should be trading at $70 given the current economic conditions. Currently, the P/E Ratio is 12x or 4% below its normal trading range.
Unlike other central banks around the world such as the U.S. Federal Reserve, Brazil's Central Bank has just one responsibility: to keep inflation low.