IndexIQ is putting the spotlight on both Canada and Australia.

The company has launched single-country small cap Exchange-Traded Funds (ETFs) focusing on the domestic markets in both Canada and Australia.

The New York -based developer of index-based investment products is aiming to make the IQ Canada Small Cap ETF (NYSE Arca: CNDA) and the IQ Australia Small Cap ETF (NYSE Arca: KROO) replicate (before fees and expenses) the performance of the IQ Canadian, Australian Small Cap Index. The idea being to provide a way of passively tracking the performance of the small-capitalization sector of publicly traded companies domiciled and primarily listed on exchanges in Canada or Australia.

IndexIQ chose Canada due to its solid economic growth, rich natural resources, high-tech industrial society and the fact that it is the fifth largest oil exporter and the second largest natural gas exporter in the world. IndexIQ also appreciates Canada’s “history of strong capitalization and conservative lending practices”.

IndexIQ turned their attention to Australia because of their expanding resources sector, their loyal energy trading partners in Asia and the fact that they are the only major economy to have avoided a technical recession in 2009. Australia experienced only one quarter of a contraction in gross domestic product and is entering its 19th straight year without a recession.

“These domestic economies have their own important dynamics, driven by oil, gas and metals production in Canada, and coal and metals production in Australia. CNDA and KROO are vehicles dedicated to providing investment exposure to the domestic growth potential of these two countries,” said Adam Patti, chief executive officer at IndexIQ.