An Additional Etf Pair

Many of y'all know that at that spot are a seat out of dependable commodity-related ETF pairs that rest cointegrated ever since I mentioned them inwards 2006: IGE-EWC, IGE-EEM, IGE-EWA, EWA-EWC, etc. (Their latest zScores are available here to my book's readers as well as to Premium Content subscribers.) Influenza A virus subtype H5N1 recent view to a customer inwards South Africa prompted me to add together a novel one: EWA-EZA.

It is worth noting that for those province ETF pairs that cointegrate, their underlying currency cross-rates are oft stationary every bit well. Now, at that spot are several advantages inwards trading currency cross rates instead of ETF pairs. When trading a stationary cross rate, y'all tin operate inwards a restrain guild to operate inwards as well as exit, only trading pairs of ETF's involve marketplace orders on at to the lowest degree 1 side. Also, ETF's tin sometimes last hard-to-borrow, as well as their margin requirements are much to a greater extent than onerous than that of currencies. However, the 1 major disadvantage inwards trading cross rates is that they are non e'er available on your brokerage. For example, based on the cointegration of EWA as well as EZA y'all would intend that trading AUDZAR would last quite profitable. And y'all would last right, theoretically, except that AUDZAR is non available for trading on Interactive Brokers. If y'all know of a expert Forex brokerage that accept many emerging markets cross-rates for trading, peculiarly those of Latin American countries, delight permit the residuum of us know!