Tags: emerging markets | ETF | growth | investing

Zacks: 5 Emerging Market ETFs to Buy for Higher Growth

Zacks: 5 Emerging Market ETFs to Buy for Higher Growth

By    |   Wednesday, 10 February 2016 04:01 PM

Emerging markets are known for higher volatility and fewer choices of blue-chip companies than found in the U.S., but intrepid investors can gain exposure to their potentially higher growth with exchange-traded funds.

Zacks Investment Research has identified five ETFs that allow investors to diversify their portfolios with emerging-market holdings.

The firm warns about the potential risks, though.

“The slowdown in the Chinese economy, wild swings in currencies and tumbling commodity prices are dragging emerging markets down. Brazil and Russia have already entered recession,” it writes in a Seeking Alpha blog. “Emerging markets witnessed capital outflows faster than ever in the fourth quarter of 2015. They are now facing a wide range of risks that might weigh on their sovereign, corporate and bank ratings.”

Despite those pitfalls, emerging markets have been fairly resilient.

“What protected them from a full-blown crisis was perhaps their beefed up foreign exchange reserves,” it writes. “Macroeconomic headwinds notwithstanding, emerging countries are also projected to grow at a steady rate in the near term.”

Zacks: 5 Emerging Market Funds to Buy
  1. T. Rowe Price Emerging Markets Bond Fund (PREMX) provides current income and capital appreciation. PREMX invests a large portion of its assets in government and corporate debt securities of emerging nations. PREMX's 5-year annualized return is 3.5 percent.
  2. Fidelity New Markets Income Fund (FNMIX) invests the majority of its assets in debt securities of issuers in emerging markets and other investments that are tied economically to these markets. FNMIX's 5-year annualized return is 4.7 percent. As of the last regulatory filing, U.S. Treasury Bond 3 percent was the top holding for FNMIX.
  3. JPMorgan Emerging Markets Debt Fund (JEMRX) seeks high total return and normally invests a large portion of its assets in emerging market debt investments. JEMRX's 5-year annualized return is 4.4 percent.
  4. Fidelity Advisor Emerging Markets Income Fund (FMKIX) seeks capital appreciation. FMKIX invests a major portion of its assets in securities of issuers in emerging markets and other investments that are linked economically to these markets. FMKIX's 5-year annualized return is 4.6%.
  5. Franklin Emerging Market Debt Opportunities Fund (FEMDX) seeks high total return. FEMDX invests the majority of its assets in debt securities of "emerging market countries" that the World Bank considers to be on the developing curve. FEMDX's 5-year annualized return is 2.3 percent.

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Emerging markets are known for higher volatility and fewer choices of blue-chip companies than found in the U.S., but intrepid investors can gain exposure to their potentially higher growth with exchange-traded funds. Zacks Investment Research has identified five ETFs that...
emerging markets, ETF, growth, investing
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2016-01-10
Wednesday, 10 February 2016 04:01 PM
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