Chartwell Global ETF Report

It should be no surprise to sophisticated global investors that many of the emerging market country exchange-traded funds are dominated by the top weighted companies in the index. But behind Mexico's ETF (EEW) is the incredible story of one man, Mr. Carlos Slim, arguably the wealthiest man in the world.

In an excellent article in the Financial Times by Adam Thomson is a description of his empire which makes up more than a third of Mexico's stock exchange index capitalization. According to Forbes, which last put his fortune at $53.1bn, Mr Slim's net worth last year increased by $19bn, or $52m a day. That is one hell of a cash cow.

At the core of his empire are Telmex and America Movil (AMX), his telecommunications giants. These two companies alone make up 35% of the iShares Mexico ETF (EWW).

Telmex dominates fixed-line telephony in Mexico, accounting for more than 90 per cent of the market. It is also extremely profitable: Adam's points out that every year it generates enough in top line earnings to pay for its original acquisition price. Somehow Mr. Slim was able to persuade the Mexican government to allow him to enter the wireless market, a business he would later spin off into America Movil, which he controls.

The company has increased its subscriber rate by an average of 65 per cent a year since 2000, according to Mr. Slim, and now has more than 125 million clients in over ten countries. The company has obviously been extremely active and successful in penetrating tough but lucrative emerging markets all over the world.

In many ways, companies like Telmex and America Movil are in many ways ETFs already being a basket of companies under one roof.

Find out more about using ETFs to tap into incredible growth stories like Mexico by joining Chartwell ETF today.