5 emerging stocks to beat the BRICS
Whatever happened to the BRICS? Remember them? The stock markets of Brazil, Russia, India, China, and South Africa were supposed to leave the rest of the world in the dust. The BRICS were the best new idea since hand-pulled noodles.
Lagging performance is what happened.
In 2012 the U.S. Standard & Poor’s 500 stock index returned 16%. Year to date in 2013 the return, through April 24, was 10.61%. The five-year average annual return was 5.05%
And for the BRICS? (Or actually for the index (BKF) that tracks the BRIC countries without South Africa.) The return in 2012 was 15.2% and the year to date return in 2013 is a loss of 4.87%. For five years the average annual return was a loss of 5.75%.
Who needs an asset class that under-performs and that is thought to come with greater risk than developed markets too?
But I don’t think this is the time to throw out the emerging market baby with the BRICS bathwater.
Because a funny (that’s funny peculiar and not funny ha-ha) thing has been going on while the BRIC stocks have been underperforming the U.S. market. Other emerging markets—a group without a catchy name but that I’d call the emerging emerging markets—has been outperforming both the BRICS and the U.S. markets.
Take a look at these numbers.
Join Jim for a free Webinar on emerging markets on Wednesday, January 23
Hey, I’m giving a Webinar. You know one of those Internet things where I talk and you can see me and everything.
The topic is emerging markets after the BRICS.
Time is 4:30 p.m. to 5:30 p.m. ET on Wednesday January 23.
And it’s free.
My friends at MoneyShow are hosting. And you can Sign up here.
Sure, we all know the economies of China, India, and Brazil are growing–and will continue to grow–faster than the world’s developed economies. But the fastest growth and the biggest potential profits are likely to come from a new set of emerging emerging markets. Stocks in countries such as Colombia, Turkey, Indonesia, and Nigeria (yes, Nigeria) are getting a dual boost from higher economic growth and the arrival (finally) of better fiscal policies that are earning these countries high credit ratings.
As the portfolio manager of Jubak Global Equity (JUBAX), I trade in all these markets so I can bring you first hand experience of how deep you’ll have to dig to get information, how expensive trading might be, and what markets are more—and less—trustworthy.
This Webinar will include a run down of the five emerging emerging markets I like best, practical advice on how to invest in what are, after all, not the world’s most transparent markets, and a list of ten stocks and ETFs that you can use to build your portfolio’s exposure to these next generation superstars.
Emerging Markets in 2013: Outperformance AND Volatility
On January 16 Japan’s Nikkei 225 index fell by 2.6%. That was doubly surprising. First, because the Tokyo stock market has been on such a roll—up 25.6% from November 14 to January 15 and 9.4% from December 21 to January 15. And second because the “cause” of the drop was a series of absolutely innocuous remarks by a member of the Japanese Parliament (who pointed out that a weaker yen wasn’t great for Japanese consumers) and two members of the Abe cabinet (who noted that a weaker yen wasn’t good for all Japanese companies.)
That was enough to send Japanese stocks down 2.6% on the day?
Welcome to the wonderful world of hot money, 2013-style. So far in 2013 we’re looking at a market that doesn’t have any confidence that the trend of this moment will be the trend of the next moment. And that is, therefore, constantly sloshing toward the opportunity of the minute or away from the possibility that a trend has peaked. I think these sloshes will make emerging markets—with their smaller market capitalizations than the United States, Europe, or Japan—especially volatile. Which, since these are the markets that look poised to do best in 2013, makes for some very tricky footing for investors in the year ahead.
Let’s take a slightly more detailed look at what happened in Japan and then see how these dynamics apply to the rest of the global stock market. Read more
Join Jim’s Free Webinar on Emerging Emerging Markets on January 23
Hey, I’m giving a Webinar. You know one of those Internet things where I talk and you can see me and everything.
The topic is emerging markets after the BRICS.
Time is 4:30 p.m. to 5:30 p.m. ET on Wednesday January 23.
And it’s free.
My friends at MoneyShow are hosting. And you can Sign up here.
Sure, we all know the economies of China, India, and Brazil are growing–and will continue to grow–faster than the world’s developed economies. But the fastest growth and the biggest potential profits are likely to come from a new set of emerging emerging markets. Stocks in countries such as Colombia, Turkey, Indonesia, and Nigeria (yes, Nigeria) are getting a dual boost from higher economic growth and the arrival (finally) of better fiscal policies that are earning these countries high credit ratings.
As the portfolio manager of Jubak Global Equity (JUBAX), I trade in all these markets so I can bring you first hand experience of how deep you’ll have to dig to get information, how expensive trading might be, and what markets are more—and less—trustworthy.
This Webinar will include a run down of the five emerging emerging markets I like best, practical advice on how to invest in what are, after all, not the world’s most transparent markets, and a list of ten stocks and ETFs that you can use to build your portfolio’s exposure to these next generation superstars.
Biggest effect of a stronger euro and a weaker yen/dollar will be felt in emerging markets such as China and Brazil
Pick your metaphor.
The tide has turned. The weather is changing. The momentum has shifted with the change in quarterbacks.
Anything works as long as it 1) describes the current reversal in strength by the euro against the yen and U.S. dollar and 2) reminds us that the reversal is itself easily reversed and that we don’t know much about the timing of that reversal.
I prefer “tide” myself because it suggests not just the turn in the currency markets but a change in the flows that all financial assets swim against or with. The reversal in the relative strengths of these big three currencies will, after all, have an effect on everything from earnings at big U.S. multinationals such as IBM (IBM) and PepsiCo (PEP) to the price of commodities and commodity stocks to the balance of imports and exports in China to the growth rate of the Brazilian economy.
The biggest effect, though, is likely to be on the prices of stocks in emerging markets such as China and Brazil. Read more
