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Following up on a bullish view of Norway and the Nordic country's corresponding ETFs, Street One Financial is forecasting increased activity for ETFs tracking Scandinavian countries in the coming weeks.

"With the Eurozone tensions and EU in focus seemingly every day in the headlines as we head into the summer, we would expect these ETFs to see above average activity in sympathy with the mainland European equity ETFs," said Paul Weisbruch, Street One's vice president ETF/Options Sales and Trading. The comments were made in a research note published today.

By "these ETFs," Weibruch is referring to the iShares Sweden Index Fund (NYSE: EWD), the largest of the Scandinavian ETFs, the Global X FTSE Nordic Region ETF (NYSE: GXF), the iShares MSCI Denmark Capped Investable Market Index Fund (BATS: EDEN) and the iShares MSCI Finland Capped Investable Market Index Fund (BATS: EFNL).

While the Scandinavian ETFs have been weak in the past month, incurring double-digit losses as the Euro Zone's sovereign debt crisis has escalated, some the funds have offered better year-to-date returns than the MSCI Europe Index, which is tracked by the Vanguard MSCI Europe ETF (NYSE: VGK). Year-to-date, VGK is off 6.6% compared to a 5.2% loss for EWD. GXF, which offers exposure to Sweden, Norway, Denmark and Finland, has lost just 3.2% this year.

"We imagine that there will be a handful of market participants that are using ETFs that are not currently aware of exposure being available to the Nordic countries, seeing current appeal from a valuation standpoint in the region," Weisbruch added.

EDEN, the only ETF devoted exclusively to Denmark, has lost less than 5% since its late January debut. Only EFNL, the only Finland ETF, has performed worse than VGK since its late January introduction. That fund has lost 22.3%, making it by far the worst performer among Scandinavian ETFs on a year-to-date. That's probably not a coincidence. Finland's status as a member of the Euro Zone and EFNL's large weight to the dead money stock known as Nokia (NYSE: NOK) have no doubt been drags on the ETF.

For more on Scandinavian ETFs, please click HERE.

Posted-In: Analyst Color Long Ideas News Short Ideas Specialty ETFs New ETFs Events Global Best of Benzinga

 

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