Peru's presidential election on June 7 produced one of the most dramatic market days in the iShares MSCI All Peru Capped ETF's (EPU) history. The fund surged approximately +5.5% as votes were counted in the runoff between Keiko Fujimori — conservative, pro-US, daughter of former president Alberto Fujimori — and Roberto Sánchez, a left-wing candidate. Reuters reported on June 9 that the race remains "too close to call" with overseas ballots still being counted.

EPU is up +18.51% year-to-date, ranking among the top 10 country ETFs globally in 2026. Peru — a country that NPR described this week as set "to elect its 10th president in a decade" — is running a version of the same political re-rating trade currently active in neighbouring Colombia.

Performance

EPU's 1-year return of +77.00% and 3-year return of +180.93% are extraordinary — reflecting a combination of Peru's copper and gold commodity exposure (both rallying in the 2024-2026 cycle), the structural re-rating from political stabilisation, and recent election-related inflows. The Iran war period (-8.63% since Feb 27) reflects Peru's dual vulnerability as a commodity exporter (oil prices hurt processing costs) but also as a country with significant sovereign bond sensitivity to risk-off environments.

The Election: Fujimori vs. Sánchez

Peru's political history over the past decade has been marked by exceptional instability. Since 2016, the country has had six presidents — including one who died in office, one who was imprisoned, one who was impeached twice, and one who led a failed self-coup. NPR's characterisation of Peru electing its "10th president in a decade" captures the chronic institutional fragility.

Against this backdrop, the June 7 runoff between Keiko Fujimori and Roberto Sánchez represents a classic Latin American binary: pro-market, pro-US right versus anti-establishment left.

Keiko Fujimori: The 51-year-old daughter of former President Alberto Fujimori is making her fourth attempt at the presidency. She served as first lady at 19. Her platform is explicitly pro-business, pro-investment and pro-US, with commitments to strengthen property rights, reduce mining sector regulatory burdens, and maintain fiscal discipline. CNN describes her as facing her "fourth attempt to win Peru's presidency." The market priced a Fujimori presidency as the better outcome for EPU on election day — the +5.5% surge came as Fujimori initially led the count.

Roberto Sánchez: A left-wing candidate. His platform includes increased taxation of the mining sector — Peru's primary GDP driver — and broader state intervention in resource extraction. A Sánchez presidency would be negative for EPU's top holdings in copper mining (Southern Copper, which represents approximately 21.6% of EPU weight via its Peruvian listed vehicle).

The Portfolio: Copper and Gold Dominate

EPU's investment thesis is fundamentally a commodity play dressed in a country ETF structure:

Southern Copper, via two listing vehicles, represents approximately 45.99% of EPU. This extraordinary concentration makes EPU effectively a leveraged play on the copper price filtered through Peruvian political risk. Copper — the primary conductor metal for AI data centre power infrastructure, EV batteries, and renewable energy grids — has structural long-term demand support that is independent of the near-term election outcome.

Key Facts

EPU at 13.90x forward P/E trades at a 24% discount to the MSCI ACWI — less deep than Colombia's 52% discount, but still pricing meaningful political uncertainty. A Fujimori victory that delivers a stable, investment-friendly government would narrow this gap toward Brazil (8.22x — but different context) or Chile (13.62x). Peru's commodity export mix means that copper price direction matters as much as political outcome for EPU's medium-term performance.

The Milei Template — Similarities and Differences

Peru's EPU trade shares the structural logic of Argentina's Milei trade and Colombia's De la Espriella trade: right-wing candidate in a market with accumulated political risk discount, election outcome as the binary catalyst, valuation compression as the post-election narrative.

The key differences from Colombia:

1. The count is live. Colombia's result is known — De la Espriella won the first round clearly. Peru's runoff is still being counted as of June 9, with Reuters calling it "too close to call." The uncertainty is higher, and the market rally (+5.5% on election day) has already partially priced a Fujimori outcome that has not yet been confirmed.

2. Commodity dependency is different. EPU's 45% concentration in Southern Copper means that copper prices — not just political outcomes — drive EPU returns. A Fujimori win but a copper price decline would produce a more muted re-rating than the pure political trade template implies.

3. Peru's institutional track record is worse. Argentina under Milei has delivered real policy change. Colombia has the potential to do so under De la Espriella. Peru's institutional fragility — six presidents in a decade — means any new president faces severe constraints on policy implementation regardless of ideology.

The Risk: Sánchez Wins

If Roberto Sánchez wins the count, EPU would give back a substantial portion of its election-day +5.5% surge and recent gains. Sánchez's mining tax proposals would directly compress Southern Copper's profitability — the 45.99% combined weight in EPU means any change in Peru's mining fiscal regime has immediate and large fund-level impact. The too-close-to-call count increases the probability of a Sánchez outcome relative to the pre-election polls that briefly showed Fujimori ahead.

Track EPU live at countryetftracker.com/country-detail?ticker=EPU. Compare EPU vs COLO and ARGT at countryetftracker.com/compare.

Frequently Asked Questions

Why did Peru's EPU ETF surge on June 7 election day?

EPU surged approximately +5.5% as the initial count in Peru's presidential runoff showed conservative Keiko Fujimori leading leftist Roberto Sánchez. Fujimori's platform is explicitly pro-investment, pro-mining and pro-US, which markets interpreted as favourable for EPU's top holdings — particularly Southern Copper (approximately 45.99% of fund weight combined across two listing vehicles), which would face higher taxation under a Sánchez administration. The full count remains ongoing as of June 9 with Reuters calling the race "too close to call."

What is Peru's EPU ETF concentrated in?

EPU is overwhelmingly a copper and precious metals mining fund. Southern Copper, via two listing vehicles (0U8N.L at 24.34% and SCCO at 21.65%), represents approximately 46% of total fund weight. Buenaventura (4.05%) and Hochschild Mining (3.75%) add silver and gold exposure. The remaining holdings include Intercorp Financial and diversified Peruvian corporates. EPU's performance is therefore driven by: (1) the copper price, (2) Peru's mining tax and regulatory environment, and (3) broader political stability that determines foreign investor willingness to hold Peruvian equity risk.