ETF XRAY

iShares MSCI Italy ETF (EWI)

iShares MSCI Italy Index (EWI) got up to 10.58% the first part of May but has since slipped back to it current value up 7.43% YTD.

The economy of Italy has changed dramatically since the end of World War II. From an agriculturally based economy, it has developed into an industrial country ranked as the world's fifth-largest economy in USD exchange-rate terms. More recently, Italy has faced sluggish economic growth and reduced international competitiveness. However, statistics as of 2007 show signs of an acceleration in GDP growth.

Italy's closest trade ties are with the other countries of the European Union, with whom it conducts about 59% of its total trade. Italy's largest EU trade partners, in order of market share, are Germany (19%), France (13%), and the Netherlands (6%). The country belongs to the Group of Eight (G-8) industrialised nations; it is a member of the European Union and the OECD.

Major industries in Italy are precision machinery, motor vehicles, chemicals, pharmaceuticals, electric goods, food, fashion and clothing.

DE Smith of MyPortfolioView

Italy ETF Needs More Growth

By Carl Delfeld of the Chartwell ETF Advisor

Next time you enjoy a fine Italian wine, think of the Italy ETF (EWI) and its improving prospects for growth. Tony Barber of the Financial Times reports that Italy's economy has not completely conquered its long-term problem of declining competitiveness on international markets even though it is expanding at its fastest rate for six years, according to its finance minister, Tommaso Padoa-Schioppa.

He said Italy needed to boost productivity, put more people in jobs, increase the average size of companies and strengthen law and order so as to sustain a growth rate of more than 2 per cent a year.

It might surprise you to learn that the Italy ETF has returned 26% over the past year. About 27% of this ETF basket are companies in banking and finance followed by 16% in oil & gas and 11% in utilities.