ETFs
The worst performing ETFs of the quarter
Exchange-traded funds, or ETFs, are often low-cost vehicles that allow investors to track popular indexes or take advantage of the choices of experienced managers to try to beat the market. The best ones serve as the foundation of a portfolio, and unlike open-end mutual funds, all ETFs trade throughout the day on a stock exchange.
In the second quarter of 2024, the worst performers were VanEck Rare Earth and Strategic Metals (REMX) and Xtrackers MSCI EM Latin America ESG Swap (XMLA). The data for this article comes from Morningstar Direct.
To learn more about the best performing ETFs, Discover our other story.
Selection of the worst performing ETFs
To identify the worst performing ETFs of the quarter, we selected those in Morningstar’s Equity, Allocation or Bond categories available in the UK. We excluded Exchange Traded Notes (ETNs) and ETFs with total assets of less than $25 million (£19.7 million). We also excluded funds that fall into Morningstar’s “trading” categories, as these funds are designed for active traders and are not suitable for long-term investors. All returns are shown in GBP.
Among the worst-performing ETFs, two were in the Latin American equity category, where funds fell 13.60% in the second quarter.
Top 10 Worst-Performing ETFs in Q2 2024
1. VanEck Rare Earths and Strategic Metals UCITS ETF (REMX)
2. Xtrackers MSCI EM Latin America ESG Swap UCITS ETF (XMLA)
3. ETF UCITS Global X Lithium & Battery Tech (LITU)
4. iShares MSCI EM Latin America UCITS ETF (DLTM)
5. iShares MSCI Brazil UCITS ETF USD (Dist) (IBZL)
6. Amundi MSCI Indonesia UCITS ETF (INDIA)
7. HSBC MSCI Indonesia UCITS ETF (HID)
8. ETF UCITS Swap MSCI Indonesia Xtrackers (XMIN)
9. iShares MSCI Brazil UCITS ETF (DE) (4BRZ)
10. Amundi MSCI Brazil UCITS ETF (RIO)
Indicators for the worst performing ETFs
VanEck Rare Earths and Strategic Metals UCITS Exchange Traded Fund
• Morningstar Rating: N/A
• Expense ratio: 0.59%
• Morningstar Category: Precious Metals Equities
The worst-performing ETF in the second quarter was the £62 million VanEck Rare Earth and Strategic Metals ETF, which lost 16.88%. The passive VanEck ETF underperformed the average gain of 7.49% for funds in the precious metals equity category in the second quarter. Over the past 12 months, VanEck Rare Earth and Strategic Metals has fallen 48.61%, putting it in the 100th percentile of its category and underperforming the average fund’s return of 14.46%.
VanEck Rare Earth and Strategic Metals, launched in September 2021, has a Morningstar Medalist rating of Neutral.
ETF Xtrackers MSCI EM Latin America ESG Swap UCITS
• Morningstar Rating: 2 stars
• Expense ratio: 0.57%
• Morningstar Category: Latin American Equities
With a loss of 15.50%, the £80m Xtrackers MSCI EM Latin America ESG Swap ETF was the second worst performing ETF on our list for the second quarter. The passively managed Xtrackers ETF fell further than the average loss of 13.60% for funds in the Latin America equity category. Over the past 12 months, the Xtrackers MSCI EM Latin America ESG Swap ETF has lost 11.50%, putting it in the 90th percentile of its category and falling further than the average fund’s loss of 7.62%.
Xtrackers MSCI EM Latin America ESG Swap takes into account environmental, social and governance aspects criteria to consider. This fund has a Morningstar Medalist rating of Neutral.
ETF UCITS Global X Lithium & Battery Tech
• Morningstar Rating: N/A
• Expense ratio: 0.60%
• Morningstar Category: Natural Resources Stocks
The third worst performing ETF in the second quarter was the £25m Global X Lithium & Battery Tech, which fell 13.70%. The passively managed Global X ETF underperformed the average gain of 0.73% for funds in the natural resources equity category. Over the past 12 months, the ETF has fallen 38.62% to rank in the 99th percentile of its category, underperforming the category’s average 1-year return of 6.47%.
Global X Lithium & Battery Tech has a Bronze rating from Morningstar Medalist. It was launched in December 2021.
ETF UCITS iShares MSCI EM Latin America
• Morningstar Rating: 4 stars
• Expense ratio: 0.21%
• Morningstar Category: Latin American Equities
The £243m iShares MSCI EM Latin America ETF was the fourth worst performing ETF in the second quarter, losing 12.89%. The passive iShares ETF performed roughly in line with the average loss of 13.60% for funds in the Latin America equity category. Over the past year, the ETF has fallen 5.63% to rank in the 27th percentile of its category, less than the category’s average one-year loss of 7.62%.
The iShares MSCI EM Latin America Index, rated Gold, was launched in October 2007.
ETF iShares MSCI Brazil UCITS USD (Dist)
• Morningstar Rating: 3 stars
• Expense ratio: 0.74%
• Morningstar Category: Brazil Equities
The fifth worst ETF was the £183m iShares MSCI Brazil, which lost 12.63% in the second quarter. The passive iShares ETF performed roughly in line with the average decline of 13.09% for funds in the Brazilian equity category. Over the past year, the iShares MSCI Brazil has fallen 8.44%, finishing in the 47th percentile of its category. It has outperformed the category’s average one-year loss of 10.58%.
The iShares MSCI Brazil Index is rated Bronze by Morningstar Medalist. It was launched in November 2005.
Amundi MSCI Indonesia UCITS Exchange Traded Fund
• Morningstar Rating: 5 stars
• Expense ratio: 0.45%
• Morningstar Category: Indonesian Equities
The sixth worst performing ETF in the second quarter was the £43m Amundi MSCI Indonesia, which lost 12.58%. The passive Amundi ETF performed roughly in line with the average loss of 11.78% for funds in the Indonesian equity category. Over the past 12 months, the Amundi MSCI Indonesia has fallen 11.51%, putting it in the 49th percentile of its category and less than the average fund’s loss of 14.15%.
Amundi MSCI Indonesia has received the Morningstar Medalist Gold rating. It was launched in March 2019.
HSBC MSCI Indonesia UCITS Exchange Traded Fund
• Morningstar Rating: 5 stars
• Expense ratio: 0.50%
• Morningstar Category: Indonesian Equities
With a loss of 12.58%, the £80m HSBC MSCI Indonesia was the seventh worst-performing ETF on our list for the second quarter. The passive HSBC ETF performed roughly in line with the average loss of 11.78% for funds in the Indonesian equity category. Over the past 12 months, the HSBC MSCI Indonesia has lost 11.87%, putting it in the 54th percentile of its category and below the average fund’s loss of 14.15%.
Launched in March 2011, HSBC MSCI Indonesia has a Morningstar Medalist Silver rating.
ETF UCITS Swap MSCI Indonesia from Xtrackers
• Morningstar Rating: 5 stars
• Expense ratio: 0.65%
• Morningstar Category: Indonesian Equities
The eighth worst performing ETF in the second quarter was the £35m Xtrackers MSCI Indonesia Swap, which fell 12.57%. The passively managed Xtrackers ETF performed roughly in line with the average loss of 11.78% for funds in the Indonesian equity category. Over the past 12 months, the ETF has fallen 11.96% to rank in the 56th percentile of its category, down less than the average one-year loss of 14.15%.
Launched in March 2010, Xtrackers MSCI Indonesia Swap has a Morningstar Medalist rating of Silver.
ETF iShares MSCI Brazil UCITS (DE)
• Morningstar Rating: 4 stars
• Expense ratio: 0.27%
• Morningstar Category: Brazil Equities
The £2.1bn iShares MSCI Brazil ETF was the ninth worst performing ETF in the second quarter, down 12.48%. The passive iShares ETF performed roughly in line with the average loss of 13.09% for funds in the Brazilian equity category. Over the past year, the ETF has fallen 7.66% to rank in the 24th percentile, which is less than the category’s average one-year loss of 10.58%.
iShares MSCI Brazil has received a Morningstar Medalist Gold rating. It was launched in October 2018.
Amundi MSCI Brazil UCITS ETF
• Morningstar Rating: 4 stars
• Expense ratio: 0.65%
• Morningstar Category: Brazil Equities
The tenth worst ETF is Amundi MSCI Brazil, worth £126m, which lost 12.42% in the second quarter. The passive Amundi ETF performed roughly in line with the average loss of 13.09% for funds in the Brazilian equity category for the quarter. Over the past year, Amundi MSCI Brazil has fallen 7.70%, ending the 12-month period in the 18th percentile of the Brazilian equity category. It has outperformed the category’s average one-year loss of 10.58%.
The Bronze-rated Amundi MSCI Brazil was launched in March 2019.
What are ETFs?
Exchange Traded Funds ETFs are investments that trade throughout the day on a stock exchange, much like individual stocks. They differ from traditional mutual funds, called open-end funds, which can only be bought or sold at a single price each day. Historically, ETFs have tracked indices, but in recent years, more ETFs have become actively managed. ETFs cover a range of asset classes, including stocks, bonds, commodities, and, more recently, cryptocurrencies.
Best ETFs: Other Ideas to Consider
Investors who want to find more of the best performing or cheapest ETFs can do the following:
• Read the latest news articles about ETFs.
• Use the ETF Selection Tool to find the best ETFs based on your specific criteria. You can search for funds based on their fees, Morningstar Medalist ratings, manager tenure, and more.
• Compare Funds and ETFs side by side and easily track their reviews, ratings and fees.
This article was compiled by Bella Albrecht, edited by Lauren Solberg, and reviewed by Sunniva Kolostyak.
This article was generated using automation and reviewed by Morningstar editors.