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Emerging market funds investor alert: John Manley says buy stocks

By Emerging Money June 24, 2012, 12:00:17 PM EDT

Is it time for you to buy stocks in emerging market funds? A leading strategist for Wells Fargo Advantage Funds ( WFC , quote ) says he'd go for it.

[caption id="attachment_64620" align="alignright" width="300" caption="Seoul, South Korea: emerging high-rise city"] Image courtesy Bobbie Johnson: http://www.everystockphoto.com/photographer.php?photographer_id=6319 [/caption]

Wells Fargo Chief Equity Strategist John Manley said in Bloomberg Businessweek:

" I'd be a buyer of stocks. The U.S. economy is doing OK. Obviously, there are lots of things that could go wrong. We're going to have to see more agreements in Europe. Yet valuation is attractive, the market is cheap."

Recent events have been bullish for emerging market funds . The SPDR S&P Emerging Markets ( GMM , quote ) emerging market fund is up. WisdomTree Emerging Market Equity ( DEM , quote ) rose 2.32%. In the last week, the Vanguard MSCI Emerging Markets ( VWO , quote ) finished higher by 3.21%. The iShares MSCI Emerging Markets Index ( EEM , quote ) climbed 3.38%.

These emerging market funds in the form of exchange traded funds (ETFs) offer advantages for investors who are heeding Manley's advice. The most obvious advantage is diversity. GMM, DEM, VWO and EEM let emerging market investors buy a broad array of stocks in one bundle. It is usually much more efficient for an investor to buy an emerging market fund than to try to copy its holdings.

ETFs also have many more resources than investors do. They can do more research, and they have buying power. Emerging market funds get better service and pricing than an individual investor ever can. They can also protect against currency fluctuations.

Many of the stocks that Wells Fargo's Manley is so bullish about are contained in ETFs such as SPDR S&P Emerging Markets, WisdomTree Emerging Market Equity, Vanguard MSCI Emerging Markets and the iShares MSCI Emerging Markets Index. Buying these and other emerging market funds is a sound way for individual investors to profit from the attractive valuations on the financial exchanges.




The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, International, Stocks

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