Four Emerging Markets to Watch

In personal finance, the term “international exposure” gets brought up a lot. But which nations around the world should you want to expose yourself to?

I would make a bet on these four emerging markets as they offer a lot of growth, though they do come with some risk.

Photo by Doran Erickson on Unsplash

China

China is the second largest economy in the world. They are also cooking the books. They have the potential to overtake the US within the decade. I apologize to my fellow patriots, but it is probably true. One risk that stands out with China is the possibility of nationalization of certain industries over there. Perhaps not overtly, but it is likely that certain companies (like Huawei) are under some form of government control.

Overall a solid long term buy, even with the looming specter of their government.

India

India is the fastest growing economy in the world. They have the population density of China, but their government is less authoritarian. They are rapidly modernizing and are very efficient. Their main drawback is that large parts of the country are still heavily impoverished, though this may change as their economy begins to develop a larger portion of middle class workers.

Another solid buy to get in on right now.

Africa

Africa remains a land of great opportunity. Their mineral wealth and availability of land is really unparalleled. Africa would benefit from heavy use of drought tolerant crops and greater access to infrastructure including internet. The region may grow to become the next economic hot spot over the next century.

I would slowly buy in over the next decade.

South America

South America is rich in land similar to Africa. The problem (is it a problem?) is that much of the land should be protected. A greater problem is that their governments are relatively unstable and often corrupt. This makes investing here now a much riskier proposition. However, if these issues can be resolved, countries like Brazil stand to grow a lot over the next few decades.

I would again, slowly buy in.

International investments can be an interesting and productive portion of a well-balanced portfolio. The smart investor should know the risks associated with choosing emerging markets and the different markets available to them.