There is no doubt that emerging economies have kept growth alive
for the US in the past three years. With 45% of S&P profits
coming from abroad, the global economy is a daily reality for many
successful US companies including Caterpillar, Eaton, Cummins,
Boeing, McDonalds, Starbucks, Microsoft, and Apple.
I have been looking lately at various ways to get exposure to
high single-digit and double-digit growth rates in emerging
markets. The sell-offs in Brazil and India are especially
attractive. And yesterday I saw Blackstone strategist Byron Wien on
Bloomberg offer these 3 investment stats on EM:
1) Emerging Economies represent 37% of global GDP.
2) But they are 75% of the growth.
3) And most institutions only allocate 10% of investment capital
to EM equities.
My rough sense of the situation is that we have over 2 billion
people likely aspiring to the lifestyles of the West. And their
governments must do everything to support development and commerce
that will allow them to have their wishes.
How are you allocating to this powerful growth trend that does
not appear like it will let up for decades?
Do you invest directly in BIICS companies (drop Russia, add
South Africa and maybe Indonesia)?
Do you buy select country ETFs like those for South Korea (
) or India (
Do you stick with US multinationals like those named above?
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