| Did you know that the Russian stock market | | | | stock markets spell long-term bad news for |
| grew by a staggering 89.56% over the last | | | | emerging market stocks. This may have been |
| year? Or that the Egyptian stock market grew | | | | true in the past, but is much less relevant |
| by a no less impressive 57.98% a year over | | | | nowadays. Many of the hotter markets, which |
| the last five years? Performance records in | | | | suffered bad falls last May, have already |
| the emerging markets of Eastern Europe, Asia, | | | | bounced back. Anyway, it is a great mistake |
| the Middle East and South America have been | | | | to lump all emerging markets together. Each |
| nothing short of spectacular. Furthermore, an | | | | one needs to be considered on its strengths |
| impressive number of companies in these | | | | and weaknesses, just as individual stocks do. |
| emerging markets are rapidly turning | | | | There is huge difference between, say, |
| themselves from regional success stories into | | | | Thailand and Brazil in the same way that |
| huge multi-national conglomerates. As the | | | | there is a huge difference between, say, |
| UK's Investors Chronicle recently reported: | | | | Delta and Ryanair.How can you buy a little |
| 'If you are looking for decent, relatively | | | | piece of the emerging market action? If you |
| cheap, relatively safe stocks you no longer | | | | are willing to do the research you could |
| have to limit your choice...the world is | | | | invest directly. A good source of information |
| quite literally your oyster.'Does it make | | | | is Boston Consulting's RDE 100 list. The |
| sense, however, for a small, cautious, | | | | initials 'RDE' stand for 'Rapidly Developing |
| private investor to put his or her hard | | | | Economies' and the list comprises 100 firms |
| earned cash into this sector? For those who | | | | from developing economies that are leading |
| have already built up assets closer to home | | | | the pack when it comes to globalising their |
| the answer could well be 'yes'. We live in a | | | | businesses. The list is to be found at Some |
| global economy, stock markets historically | | | | are already global players including |
| outperform all other forms of investment and | | | | heavyweight names such as Mexico's CEMEX (one |
| one of the golden rules of making money is | | | | of the world's largest cement makers); Hong |
| diversification. So, now could well be a very | | | | Kong's Johnson Motors (which has 40% of the |
| good time to start dipping your toe in rather | | | | global market for small electric motors); and |
| more exotic foreign waters.Why do emerging | | | | Brazil's Embraco (which as 25% of the global |
| markets offer such good potential? I have | | | | market for compressors). Others already enjoy |
| already mentioned globalisation and its | | | | national or regional dominance and are now |
| effect should not be underestimated. The | | | | poised for global growth. They include |
| developed world depends for its own expansion | | | | India's Tata Motors; Turkey's consumer goods |
| on products and services purchased from the | | | | firm, Vestel; and Egypt's Orascom Telecom. |
| emerging economies. Growing political | | | | Sixty of the firms on the list are, by the |
| stability, developing equity markets and | | | | way, publicly quoted. If you would prefer |
| rapidly rising commodity prices all add to | | | | less direct involvement there are plenty of |
| the attraction. It should also be noted that | | | | managed funds to pick from. The top performer |
| many companies are now listed not only on | | | | for the last five years has been Credit |
| their local exchanges but also in London and | | | | Suisse European Frontiers, which is currently |
| New York.What are the pitfalls? It is | | | | showing a 292% gain. |
| generally said that dips in the world's major | | | | |