Brazil Votes October 4: Why Brazilian Equities Are Moving, And The Only 3X/-3X On EWZ
Brazil votes on October 4, with possible runoff October 25. The race is close. BRZL and BRZD are the only US-listed products designed to provide 3X and -3X daily exposure to EWZ, the iShares MSCI Brazil ETF.
Brazilian equities are on the tape now for a reason: the central bank has started cutting a 15% policy rate, and a near-even presidential race is less than two weeks away. For most of the last two years EWZ tracked that rate fight, not politics. That has changed over the last few months.
Source: Yahoo Finance, EWZ daily closing prices, two years ended September 21, 2026. Past performance does not guarantee future results. EWZ is not affiliated with the ETNs and is shown as the reference exposure only.
The iShares MSCI Brazil ETF (EWZ), daily closing price over the last two years.
What Is Going on in Brazil
Brazil elects a president on October 4. A runoff follows on October 25 if no candidate wins more than 50% of the vote.
The race is between President Luiz Inácio Lula da Silva of the Workers’ Party, seeking a fourth term and Senator Flávio Bolsonaro of the Liberal Party, son of former president Jair Bolsonaro.
AtlasIntel’s second September survey, taken September 11 to 16, 2026, put Lula at 44.1% and Flávio Bolsonaro at 41.7% in the first round, with Augusto Cury third at 3.5%.1 The race has tightened all year. In November 2025 the same survey had Lula at 47.3% and Flávio Bolsonaro at 23.1%, a gap of 24 points; it is now under 3. The same survey put a runoff between them at 46.8% for Lula and 47.2% for Flávio Bolsonaro, a gap smaller than the poll’s ±1.0-point margin of error.1 Brazilian equities have been moving with those numbers. Two voting dates remain.
Source: AtlasIntel monthly national surveys, November 2025 to September 2026, as compiled by the AS/COA Poll Tracker. Polls are not forecasts. Shown for context only.
First-round voter intention in AtlasIntel’s monthly national surveys, November 2025 to September 2026.
Why It Moves the Equity Market
Brazil’s central bank sets a policy interest rate known as the Selic. The Selic peaked at 15%, among the highest policy rates in the world before the central bank began cutting in March 2026. Five consecutive quarter-point cuts have brought it down to 13.75%.2 How much further the Selic can fall depends on the next government’s fiscal path. That makes the presidential election directly relevant to the future path of rates, the Brazilian Real and the equity market.
The iShares MSCI Brazil ETF, ticker EWZ, is the reference exposure for our Brazil ETNs. Roughly half the fund is in domestic, rate-sensitive sectors such as banks, utilities, and other companies whose earnings have historically been more sensitive to changes in the Selic (as of September 21, 2026, it held 45 positions, weighted 35.97% in Financials, 15.92% in Energy, 13.02% in Materials and 13.04% in Utilities.3) A cut from 13.75% is a much bigger economic event for a Brazilian bank than it would be for an American one.
Close to 30% of the fund is tied to commodities, primarily oil and iron ore. Those businesses are driven more by global prices than by domestic politics. Those two parts of the portfolio can therefore move for very different reasons, which helps explain why EWZ can have a major move on a day when US equities barely budge.
What The Outcomes Change
The two campaigns offer different fiscal paths. Lula’s program is more consumption-led, with larger social transfers, financed in part by higher taxes on high-income households, foreign dividends, and banks. Flávio Bolsonaro is campaigning on a smaller state, tighter spending and further privatization of state-owned companies.
Neither winner could put that agenda in place alone. Major measures would require congressional approval, and some need constitutional change. Markets do not wait. They reprice the path of spending, the Selic and Real as the odds move. That repricing can run in either direction, and neither the direction nor the magnitude of any move can be predicted.
The Options Market Has Already Crowded In
EWZ options open interest stood at 7.1 million contracts on September 10, 2026, against a 52-week average of 4.8 million. That is in the 100th percentile of the past 252 trading days, the highest level in a year.4
The positioning leans long. Calls account for 5.5 million of those contracts versus 1.6 million puts, a put/call open interest ratio of 0.28 against a 52-week average of 0.5. Call open interest rose 12.2% in the five sessions through September 10.
The buildup also has a date attached. The largest single increase was in the October 2, 2026 expiration, which added 82,836 contracts. October 2 is the last trading day before the first round of voting.4
A New Way To Trade It 3X Long or Short
As of September 22, 2026, BRZL and BRZD are the only US-listed exchange-traded products that offer 3X and -3X exposure to EWZ. No other US-listed ETP is built to do that.
The MicroSectors™ Brazil exchange traded notes reference EWZ’s daily share price. BRZL is designed to return +3X that day’s EWZ move before fees and charges. BRZD is designed to return -3X that day’s EWZ move before fees. Both reset at the end of each trading day.
EWZ is the US-listed vehicle most traders already use for Brazil. It trades when São Paulo is closed so the US print is the intraday expression of that market. That is the price these notes are built on. Holding the ETNs is not the same as owning EWZ or Brazilian stocks.
Same catalyst, opposite sides. Each is a single-day trading decision, and neither is intended to be held beyond one trading day.
A 2% day in EWZ is designed to show up as a roughly +6% or -6% in BRZL or BRZD, before fees. A 4% day is designed to show up as roughly +12% or -12%. The 3X and -3X apply to one session. They do not apply to the move from today through October 4, or from the first round through a runoff on October 25.
If EWZ rises 2% on Tuesday and falls 2% on Wednesday, the two ETN sessions do not cancel. Each day resets off the prior close, so the path of those two days can leave both the long and the short note worse than a simple 3X of the net move. That is why these are not vehicles for sitting through the election. They are vehicles for a view on today’s EWZ print, taken one session at a time, while the vote is still a live input into that print.
Sources
1. AS/COA Poll Tracker: Brazil’s 2026 Presidential Election, Americas Society/Council of the Americas, updated September 22, 2026, accessed September 22, 2026. The series plots AtlasIntel monthly national surveys; the September figure is AtlasIntel’s second September survey, conducted September 11 to 16, 2026, with a sample of 5,018 and a margin of error of ±1.0 point.
2. Banco Central do Brasil Copom decisions, as reported by Rio Times Online, September 2026.
3. BlackRock iShares MSCI Brazil ETF fund page, holdings and sector breakdown as of September 21, 2026.
4. MarketChameleon Open Interest Trends and Barchart Put/Call Ratio, both for EWZ, September 10, 2026. Both figures are 15-minute delayed and change every session.
Risks And Disclosures
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