Wednesday, July 6, 2022
Market-Reporter
  • Home
  • Markets
    • U.S. Markets
    • Canada
    • Europe & Middle East
    • Emerging Markets
    • Asia
    • Latin America
  • Investing
    • Stocks
    • IPOs
    • Mutual Funds
    • ETFs
    • Bonds
    • Commodities
    • Currencies
    • Cryptocurrencies
  • Economy & Politics
    • Personal Finance
    • Spending & Saving
    • Retirement
    • Real Estate
No Result
View All Result
  • Home
  • Markets
    • U.S. Markets
    • Canada
    • Europe & Middle East
    • Emerging Markets
    • Asia
    • Latin America
  • Investing
    • Stocks
    • IPOs
    • Mutual Funds
    • ETFs
    • Bonds
    • Commodities
    • Currencies
    • Cryptocurrencies
  • Economy & Politics
    • Personal Finance
    • Spending & Saving
    • Retirement
    • Real Estate
No Result
View All Result
Market-Reporter
No Result
View All Result
Home Emerging Markets

MR MONEY MAKER: Emerging markets are long-term wealth creators

MtR by MtR
June 18, 2021
in Emerging Markets
0


MR MONEY MAKER: Emerging markets are long-term wealth creators for investors

By Justin Urquhart Stewart For The Daily Mail

Published: 21:51 BST, 18 June 2021 | Updated: 21:51 BST, 18 June 2021

What’s happening? 

The stock markets, unsurprisingly, got themselves into a terrible tizzy last year as they tried to make sense of what the effects of the pandemic would be. 

As a result, fund managers around the world sold off over £31.8billion of emerging market investments. Then, like sheep, poured £72.4billion back in again. 

During this time, we also saw a growth in the ‘developed’ markets of nearly 12 per cent, leaving the emerging indices still gaining but at a significantly slower rate of around 6.8 per cent. 

Looking ahead: Longer-term wealth creation is going to be in the developing and emerging economies

Most recently we have seen emerging markets buoyed by rising basic commodity prices. Importantly, you should not regard the term ’emerging markets’ as a bland, magnolia-coloured can of emulsion covering them all – this is patronising rubbish as they are all very different. 

Why does it matter? 

Longer-term wealth creation is going to be in the developing and emerging economies. Developed countries, including our own, will buy their exports and invest in these countries. But it will be in emerging markets that we see the better growth and long-term returns. 

We can divide emerging markets into different categories. First, you have the commodity providers, usually of mined products. So here we can lob in South Africa, Brazil, Indonesia (palm oil) and Russia. Yes, I still call Russia ’emerging’ – remember, the entire economy of that vast nation is less than 45 per cent of the UK’s! 

Then you have countries where the middle class is growing, including India, China, Mexico and, again, Indonesia.

What should I do? 

The term ’emerging market’ covers a very broad range, and we should not think of them en masse but consider the individual potential rewards and risks.

If you think that after the pandemic the global economy will not merely bounce back to where it was, but return to a more reliable growth path, then a commodity fund can be useful. The price of oil has risen to over $73 per barrel. Only two years ago it was close to nought! Mutter from the gutter is telling me that traders expect a potential rise to $100, but that is quite a tall order. 

These rising costs will feed into inflation and we are already seeing central bankers considering interest rate rises – but not likely this year – which could put a kibosh on much of the current market pricing. 

The other theme is the rise of the Oriental consumer and that is likely to grow, especially in areas with a growing middle class.

Any suggestions? 

For a low-cost commodity price tracking fund the Invesco Bloomberg Commodity UCITS ETF provides a good entry and covers the asset class well. 

For a more specific focus on an area where there is a growing middle class then Asean (Association of Southeast Asian Nations) fits the bill. There is an Asean-specific fund – the Global X FTSE Southeast Asia ETF. 

Both are good investments, but they must be put in the longer-term folder to get the real value of the growth in these sectors. 

Justin Urquhart Stewart co-founded fund manager 7IM and is chairman of investment platform Regionally. 

Share or comment on this article:

Some links in this article may be affiliate links. If you click on them we may earn a small commission. That helps us fund This Is Money, and keep it free to use. We do not write articles to promote products. We do not allow any commercial relationship to affect our editorial independence.



Source link

Related articles

Short Interest in Morgan Stanley Emerging Markets Debt Fund, Inc. (NYSE:MSD) Expands By 18.2%

July 6, 2022

Va. Plan Hires Emerging Markets Equity Manager – FIN News

July 5, 2022

Related Posts

Short Interest in Morgan Stanley Emerging Markets Debt Fund, Inc. (NYSE:MSD) Expands By 18.2%

by MtR
July 6, 2022
0

Morgan Stanley Emerging Markets Debt Fund, Inc. (NYSE:MSD - Get Rating) was the target of a large growth in short...

Va. Plan Hires Emerging Markets Equity Manager – FIN News

by MtR
July 5, 2022
0

Va. Plan Hires Emerging Markets Equity Manager  FIN News Source link

Asset allocation highlights – ‘When the facts change…’

by MtR
July 5, 2022
0

For central banks, the facts have now changed: inflation has been persistent enough for them to drop the ‘transitory’ moniker...

MENAP and Turkey-based startups raise $5.1bln in H1 2022

by MtR
July 5, 2022
0

VC funding in MENA, Africa, Pakistan and Turkey reached a record high in H12022, with startups raising nearly 70 percent...

EMERGING MARKETS-Asian currencies trade mixed, China’s yuan gains most

by MtR
July 5, 2022
0

July 5 (Reuters) - The following table shows rates for Asian currencies against the dollar at 0207 GMT. CURRENCIES VS...

Load More
  • Trending
  • Comments
  • Latest

Bank of England tells ministers to intervene on digital currency ‘programming’

June 21, 2021

Tips for checking smoke alarms during daylight saving time

March 12, 2022

GLOBAL MARKETS-U.S. stocks follow Europe up; Treasury yields rise, dollar firm

July 9, 2021
Fed tapering and emerging markets

Fed tapering and emerging markets

June 7, 2021
African currencies week ahead: Zambia's kwacha seen on back foot, Kenyan shilling up – Business Recorder

African currencies week ahead: Zambia's kwacha seen on back foot, Kenyan shilling up – Business Recorder

0
Maxum Foods releases Global Dairy Commodity Update for June

Maxum Foods releases Global Dairy Commodity Update for June

0
Letter: Perpetual bonds can help states fight hunger

Letter: Perpetual bonds can help states fight hunger

0
United Kingdom ETFs Are Riding the Re-Opening Momentum

United Kingdom ETFs Are Riding the Re-Opening Momentum

0

Report: Green bonds flying in China

July 6, 2022

Subsidy on 5 commodities for KP to continue: ECC allows one-time release of banned items stuck at ports, airports

July 6, 2022

Binance Resumes Local Currency Deposits with Brazilian Payment System Pix

July 6, 2022

Core Scientific Unloaded Most of Its Bitcoin in June Amid Market Slump

July 6, 2022

Recent News

Report: Green bonds flying in China

July 6, 2022

Subsidy on 5 commodities for KP to continue: ECC allows one-time release of banned items stuck at ports, airports

July 6, 2022

Binance Resumes Local Currency Deposits with Brazilian Payment System Pix

July 6, 2022

Categories

  • Asia
  • Bonds
  • Canada
  • Commodities
  • Cryptocurrencies
  • Currencies
  • Emerging Markets
  • ETFs
  • Europe & Middle East
  • IPOs
  • Latin America
  • Mutual Funds
  • Personal Finance
  • Real Estate
  • Retirement
  • Spending & Saving
  • Stocks
  • U.S. Markets
  • Privacy & Policy
  • About Us
  • Contact Us
  • Advertise with us

© 2021 Copyright Market-Reporter

No Result
View All Result
  • Home
  • Markets
    • U.S. Markets
    • Canada
    • Europe & Middle East
    • Emerging Markets
    • Asia
    • Latin America
  • Investing
    • Stocks
    • IPOs
    • Mutual Funds
    • ETFs
    • Bonds
    • Commodities
    • Currencies
    • Cryptocurrencies
  • Economy & Politics
    • Personal Finance
    • Spending & Saving
    • Retirement
    • Real Estate

© 2021 Copyright Market-Reporter