Is it Time to Reconsider International (Emerging) Markets??

While many international economies are still catching up to the United States on the global recession scorecard, international stock markets, specifically emerging markets, are off to a strong head start in 2009 when compared to the U.S. equity markets.


Source: Wachovia Securities.  Performance data is as of March 31, 2009. Past performance is not an indication of future results.

As you may recall (and are reminded of in the chart above), emerging markets, which are largely not directly associated with the current credit crisis gripping the developed countries of the world, experienced the largest declines of the major equity asset classes in 2008.   This has created very attractive buying opportunities and fundamental values that we have not seen, in some cases, since the Russian Ruble crisis back in 1998.  Emerging market countries in Asia, such as China, which itself has the luxury of having approximately 2 billion of its own captive consumers to help grow their economy, appear, to us at Hennion & Walsh, to offer the most intriguing growth potential, in terms of international markets, for the balance of 2009.

However, remember that Emerging Markets have their own unique set of risks that should be carefully considered before making an investment.