Polish ETF Rises to Top of October International Rankings

The iShares MSCI Poland ETF (EPOL) outperformed all other international funds in October after Polish stocks rose following an election that ousted the ruling Law and Justice Party.

Meanwhile, the war in Gaza weighed heavily on Israeli exchange-traded funds last month.

EPOL took the title of best-performing international ETF in October, returning 16%, according to etf.com data. The ARK Israel Innovative Technology ETF (IZRL) was the worst-performing fund, losing 15%. U.S. stocks, as measured by iShares Core S&P 500 ETF (IVV), fell by 2.2% during the month, while international stocks fell 3.1%, as measured by the iShares MSCI ACWI ex U.S. ETF (ACWX). 

The best and worst international ETFs were ranked according to one-month trailing total return as of Oct. 31. Inverse and leveraged funds were excluded from the rankings and etf.com data only includes ETFs traded on U.S. exchanges.  

Best Performing International ETFs in October

Worst Performing International ETFs in October

Polish Elections 

EPOL soared after the ruling Law and Justice party was defeated by a coalition of pro-European Union, centrist parties in elections in mid-October. The most likely new prime minister, Donald Tusk, was formerly head of the European Council, the EU's governing body.  

The new governing coalition may convince the EU to unfreeze the $37 billion in EU funds that the union had withheld because of concerns over the previous government’s commitment to the rule of law, risk advisory firm Teneo told the Wall Street Journal.  

Andrzej Lis, a fund manager at the Rockbridge TFI, a money manager firm, told Bloomberg that “the election was a game-changer for Polish equities."

Egyptian Fund a Winner 

The VanEck Egypt Index ETF (EGPT) and the Global X MSCI Pakistan ETF (PAK) took second and third place, returning 16% and 14%, respectively. Egypt has been suffering from extremely high inflation, which has caused investors to pour money into the market as a hedge, according to Bloomberg.

Pakistan’s markets have been buoyed by progress made in negotiations with the International Monetary Fund to continue to secure funding, which helped the country avoid a sovereign default earlier in the year, according to Reuters. 

War Weighs on Israeli ETFs 

The war in Gaza, which started after an attack by Hamas on Israel on Oct. 7, depressed Israeli ETFs, as the mobilization of reserves in the Israeli military has pulled workers out of the office and onto the front. Israel stock funds had already been underperforming this year. 

The other two worst-performing funds tracked Vietnamese stocks. Possible reasons include a slowdown in the manufacturing sector, according to S&P Global data, and continuing trouble in the real estate sector, according to Reuters.  

Contact Gabe Alpert at [email protected]