Leading the market! The Brazil ETF suddenly surges, up over 18% this year

On March 24, the market rebounded overall. According to Wind data, among the top ten ETFs by increase, besides gold stocks ETF, the cross-border Brazil ETF E Fund (520870) also ranked fifth, closing up 5.5%. Another Brazil-focused ETF in the A-share market, Huaxia (159100), also gained 3.86% that day.

It’s worth noting that since the beginning of this year, these two funds have gained 18.07% and 18.42%, respectively, ranking among the top five cross-border ETFs by performance.

Brazil ETFs Perform Well

Launched in November 2025, the first batch of Brazil ETFs are issued by E Fund and Huaxia Fund, tracking the Ibovespa index managed by well-known Brazilian asset management companies through investments in Ibovespa ETFs.

Ibovespa reflects the overall performance of the most liquid and largest market capitalization stocks on the Brazilian stock exchange. Compared to the CSI 300 index, the Ibovespa has a higher concentration of top constituents—over 50% combined weight in the top ten stocks—and a higher proportion of resource-based companies.

The index covers several key sectors where Brazil has competitive advantages internationally, including Vale, one of the world’s largest iron ore producers, and Petrobras, the state-owned energy giant; the financial sector also has a high weight, including major financial institutions like Banco do Brasil and Bradesco.

Specifically, on March 24, E Fund’s Brazil ETF had a trading volume of 485 million yuan, an increase of 318 million yuan from the previous trading day, a 190.22% increase. Huaxia’s Brazil ETF had a trading volume of 362 million yuan, up 195 million yuan from the previous day, a 116.47% increase.

As of March 23, E Fund’s Brazil ETF had a scale of 516 million yuan, and Huaxia’s was 423 million yuan.

Institutions Optimistic About Brazil’s Stock Market in 2026

Brazil’s stock market experienced a bull run in 2025, and the upward trend is expected to continue into 2026. In February, the Ibovespa index hit a record high of 192,623.56 points.

“A recent strong performance in Brazil may be related to the global surge in resource commodities driven by the Middle East conflict,” analyzed a metals fund manager in South China. “Brazil is a major emerging market and resource-driven economy in South America, with economic growth closely linked to commodity cycles. Its rich resource endowments could benefit from the current shifts in the global energy landscape.”

Brazil is extremely rich in mineral resources, with key minerals like niobium and iron highly complementary to China’s strategic mineral needs. In energy, Brazil is the second-largest oil reserve holder and the top oil producer in South America. Thanks to abundant hydropower resources, Brazil’s electricity supply heavily relies on renewable energy. With these unique resource advantages and an export-oriented economy, Brazil experienced remarkable economic growth in the last century.

JPMorgan predicts that 2026 could be a year of significant foreign investment inflows into Brazil’s stock market, as global funds’ allocation to emerging markets is currently low (only 5.3%). If it rises back to the historical average of 6.7%, it could bring approximately $25 billion in capital inflows.

Guotai Haitong believes that in the long term, Brazil’s economy needs to solidify its foundation by balancing “fiscal sustainability, inflation stability, and industrial transformation,” and improve productivity through structural reforms. Drawing on country-specific and historical experience, the key is to actively promote the “reindustrialization” strategy—strengthening the industrial base, reshaping industrial competitiveness, and upgrading the supply chain to higher value-added segments.

The institution also emphasizes that Brazil’s recent “New Industrial Plan” has increased manufacturing output and export ratios, aligned with economic transformation goals, narrowed social income gaps, and improved social safety nets. Compared to other resource-rich countries and Latin America, Brazil has advantages in market size, education level, open business environment, and industrial infrastructure. As a regional power with relatively stable geopolitical and trade conditions, Brazil is expected to leverage its large population to generate development dividends, boost productivity, and attract sustained foreign investment and capital return.