It has been
that there is no dearth of global investment acronyms. Many of them
are quite catchy, including BRICS, CASSH and MIST.
As BRICS has proven this year
, not all investment acronyms lead to superior returns and some
come with murky outlooks.
Investors searching for the right mix of near-term upside and
outsized performance over the long haul may want to consider one
letter: P. The triple P's are three emerging markets on three
continents all starting with the letter P. Each offers investors a
different investment thesis and each has the potential to deliver
superior long-term returns.
Below are Triple P's ETFs listed in alphabetical order by
iShares MSCI All Peru Capped Index Fund (NYSE:
) On a year-to-date basis, the iShares MSCI All Peru Capped Index
Fund ranks second in terms of performance among the major ETFs
tracking South American countries, trailing only the Global X FTSE
Colombia 20 ETF (NYSE:
EPU topped out just below $47 in April and
has been trending lower since
. It may appear that trying to scoop up EPU here is akin to
catching a falling knife, but the near-term weakness is more the
result of Peru's status as a major materials exporter.
Translation: Peru produces a lot of copper (gold and silver,
too) and with industrial metals demand waning, EPU has languished.
EPU's recent woes underscore the notion that investors may be
forgetting that Peru
will show the best GDP growth of any South American
country this year
Adding to the bull case for Peru is
is relatively low political risk
and an improving government balance sheet.
Investors that want some Peru exposure without going "all in" on
the country should consider the Global X FTSE Andean 40 ETF (NYSE:
), which offers combination exposure to Chile, Colombia and Peru.
AND has risen nearly 10 percent this year.
iShares MSCI Philippines Investable Market Index Fund (NYSE: )
Investors that take a myopic view of the iShares MSCI Philippines
Investable Market Index Fund will see an ETF that has failed to
impress over the past several days. What they are missing out on is
a fund and one of the top-performing country funds in 2012.
EPHE's bullishness this year has helped call attention to the
long-term potential of the Philippines. GDP growth is expected to
be 4.2 percent this year and five percent in 2013, according to
World Bank forecasts.
Moody's Investors Service and Standard & Poor's are both
constructive on the Philippines. The former raised its outlook to
positive on the Philippines in May. Last month, Standard &
Poor's finally got around to raising the country's long-term
foreign currency-denominated debt to BB+ from BB, the highest
rating since 2003. The new rating is just one notch below
investment grade and it is the same rating S&P has on
Indonesia, Southeast Asia's largest economy.
These moves make sense as the Philippines is home to a debt/GDP
ratio of 51 percent as of the end of the first quarter. Of course
it cannot be forgotten that .
Bond investors can gain some exposure to the Philippines with
the PowerShares Emerging Markets Sovereign Debt ETF (NYSE: ) and
the WisdomTree Asia Local Debt Fund (NYSE: ).
Market Vectors Poland ETF (NYSE: ) The Market Vectors Poland ETF
is the only fund on this list with a direct rival, that being the
iShares MSCI Poland Investable Index Fund (NYSE: ). EPOL is
slightly with an impressive 5.5 percent yield. In PLND's favor, it
is less exposed to the financial services sector and features a
slightly higher allocation to energy and materials names.
It is Poland's that lend credibility to the Polish investment
There are more feathers in Poland's cap. The country is expected
to show positive economic growth this year and that is not
something to be taken lightly in Europe. Poland was the only
European nation to enter a recession during the financial crisis.
The country's economy is domestically-focused, not
export-dependent, providing Poland with at least a little bit of
cover from the Eurozone's sovereign debt crisis.
For more on emerging markets acronyms, click .
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