The world economy is but a shadow of its former self, but the
change in dynamics has resulted in a greater divergence between the
emerging markets and the developed ones. Investors who are looking
to gain exposure to the world outside of the United States may
consider an all-world exchange traded fund (
The International Monetary Fund (
) estimated that global GDP may expand 4.8% this year, or growth
above the average 4% trend,
. But consider the disparity between rapidly expanding emerging
markets, with some hitting close to 10%, and the slowly inching
economies in the developed countries. [
The Potential of Emerging Market ETFs.
are not expanding as quickly as they were before, but they're still
growing. Their fundamentals are looking good, with productivity and
debt at healthy levels. This situation makes emerging markets an
attractive investment locale, but emerging countries are trying to
stem the rise in their
that comes with greater foreign demand, even though the
circumstances may warrant some appreciation.
In developed countries, cutbacks are being implemented after
economies have stabilized, and asset busts are usually followed by
years of recovery and general weakness. Additionally, developed
countries are also suffering from aging populations.
The National Association for Business Economics (NABE) reduced
its 2010 and 2011 growth projection to 2.6% from its previous
forecast of 3.2% as the impact of government stimulus diminishes
growth and high debt impedes consumer spending,
reports Ann Saphir for ABC News
. The Federal Reserve has recently stated that it is ready to
support the economy if the economy continues to weaken. Forecasters
also expect U.S. unemployment to only drop to 9.2% by the end of
For more information on world economies, visit our
global ETFs category
Where will the growth be? If you're looking for a "set it and
forget it" kind of fund, consider an all-world ex-US ETF.
Vanguard FTSE All-World ex-US ETF (NYSEArca:
is up 13.1% in the last three months; VEU is most heavily
allocated to Western Europe (42%); Asia ex-Japan (24.4%); Japan
(14.5%) and North America (6.5%)
Max Chen contributed to this article.