ETFriday: Korea, Chile Copper, and Banks After Fear and Greed Printed 10/100

This Week's Setup

Sentiment gauges briefly collapsed to 10/100 during this window, the kind of flush that forces ETF investors to look at spreads instead of headlines. Once that washout registered, Korea, Chile, and U.S. banks were already pricing mid-teens multiples with earnings yields hundreds of basis points above Treasuries.

EWY and ECH give Asia and copper leverage with double-digit drawdowns, KRE and KBE widen bank spreads into the 350s, and FRDM, XHB, CNRG, and AVEM round out EM governance, housing, clean power, and diversified EM value without pretending the tape was calm.

The 8 Names

1. iShares MSCI South Korea ETF (EWY)

Stock Pixie Score 9.0/10 | P/E 17.78 | Earnings Yield 5.6% | Yield Spread vs 10Y +120 bps

EWY trades at 17.8× earnings with a 5.6% earnings yield, a 120 bps spread over the 10Y Treasury, while the fund has compounded at 7.6% annually since inception. The drawdown here is 14%, enough to clear out momentum money but not deep enough to signal structural damage.

Taiwan risk headlines are front and center this week. South Korea sits next door geopolitically, and any escalation in the strait puts a floor under how cheap this can get before geopolitical premium overwhelms the valuation case.

Zacks flagged EWY twice this week as a likely short-term winner post-Google semiconductor breakthrough, and Barron's connected the Iran conflict to Taiwan semiconductor supply chain risk. Both catalysts point to volatility, not conviction.

2. iShares MSCI Chile ETF (ECH)

Stock Pixie Score 8.9/10 | P/E 13.88 | Earnings Yield 7.2% | Yield Spread vs 10Y +280 bps

ECH trades at 13.9× earnings with a 7.2% earnings yield, the widest yield spread in this set at 280 bps over the 10Y. The 15% drawdown pushes this into "strong entry" zone, and copper exposure (Chile's largest export) is getting press after a 70% rally in a related fund that "everyone missed."

The fund has destroyed capital since inception, down 1% annually over its life. You are buying cyclical exposure at a reset, not a long-term compounder. The setup is tactical, not structural.

Yahoo Finance and 24/7 Wall St. both covered copper-driven emerging market flows this week, with ECH getting specific mentions as a laggard that could catch a bid if the copper thesis extends.

3. State Street SPDR S&P Regional Banking ETF (KRE)

Stock Pixie Score 8.5/10 | P/E 12.38 | Earnings Yield 8.1% | Yield Spread vs 10Y +360 bps

KRE offers an 8.1% earnings yield at 12.4× earnings, the fattest yield spread in the banking pair at 360 bps over the 10Y. Regional banks are down 14% from the peak, and the fund has compounded at 8.6% annually since launch, better than most cyclical sectors over that horizon.

Barron's ran two headlines this week asking if banks are signaling a recession and whether it's time to buy after the selloff. The headline risk is real. If credit starts to crack, regional banks will underperform money-center names.

Zacks published two separate "Strong ETF Right Now?" pieces on KRE within the last week, signaling institutional interest at these levels even as the macro narrative sours.

4. State Street SPDR S&P Bank ETF (KBE)

Stock Pixie Score 8.5/10 | P/E 12.62 | Earnings Yield 7.9% | Yield Spread vs 10Y +350 bps

KBE trades at 12.6× earnings with a 7.9% earnings yield and a 350 bps spread over the 10Y, nearly identical to KRE but with broader exposure to money-center names. The 14% drawdown and 8% annualized growth since inception make this a cleaner reset than the regional play.

Barron's called banks "the most important stocks to watch now" as recession fears build. If the Fed cuts aggressively or credit conditions tighten, net interest margins compress and the earnings yield math breaks.

Zacks ran a "Strong ETF Right Now?" feature on KBE this week, and Barron's followed with a "time to think about buying" piece. The Street is watching this level, which means any breakdown gets ugly fast.

5. Freedom 100 Emerging Markets ETF (FRDM)

Stock Pixie Score 8.3/10 | P/E 16.44 | Earnings Yield 6.1% | Yield Spread vs 10Y +160 bps

FRDM has compounded at 15.3% annually since inception, the strongest long-term track record in this set, while trading at 16.4× earnings with a 6.1% earnings yield and a 160 bps spread over the 10Y. The 10% drawdown is the shallowest here, meaning strength, not panic, drove the selloff.

The Daily Upside reported that international equity ETF flows more than doubled 2024 totals, and Barron's included FRDM in a "6 Top-Performing Emerging Market ETFs" roundup. Capital is rotating into EM selectively, and FRDM is getting the nod over broader exposure.

FRDM screens out authoritarian regimes, which means China and Russia exposure is zero. That philosophical tilt has worked for performance, but it also means you miss any snapback in the largest EM weight if geopolitics stabilize.