Home February 2013 Time to Invest Overseas Again

Time to Invest Overseas Again

After an almost two-year slumber, developed and emerging international markets are finally breaking out all over the place.  Over the last few months I have been predicting that the international markets will likely outperform the U.S. markets in 2013.

With just 2.0% GDP growth here in America, stubborn unemployment rates and a ballooning deficit, many investors are currently looking overseas for a more favorable environment for investment.  Overseas markets bottomed out in June of 2012 and have been roaring ever since.

If you want to take a very broad-brush approach to the international markets, you can invest in an emerging market index exchange traded fund like the Vanguard Emerging Markets Index (VWO).  This ETF is up just over 21% since June of last year.  By comparison, the U.S. S&P 500 is up about 14%.  I currently own (VWO) in many of the accounts that I manage.

Investors can also drill down to individual countries in which to invest.  From my Best Stocks Now App, here is my current ranking of the individual country exchange traded funds:

I really like investing in China and Mexico right now.  I currently own Xinhua China 25 index (FXI) and Fomento Mexico (FMX).  I wrote about Fomento (FMX) in TheStreet.com recently.  I also own an exchange traded fund that corresponds to the Emerging Markets Small-Cap Index.

Even the beleaguered countries in Europe like Greece, Italy and Spain are recovering nicely and currently outperforming the U. S. Market.  Low interest rates all over the world are helping to fuel this recovery.

As you can see from the rankings above, the Israeli Stock Market is also starting to heat up once again. It is up 22% since June/July low of last year. Investors can invest in the Israeli Stock market through the exchange traded fund (EIS).

The components of this ETF are as follows:

Teva Pharmaceutical Ind Ltd – 22.63%

Israel Chemicals Ltd – 10.47%

Bank Hapoalim Bm – 8.43%

Bank Leumi Le-Israel – 8.11%

Bezeq The Israeli Telecom Co – 4.40%

Nice Systems Ltd – 4.04%

Mellanox Technologies Ltd – 3.44%

Israel Corp Limited – 3.07%

Israel Discount Bank 0 2.77%

Mizrahi Tefahot Bank Ltd – 2.63%

I have written about many individual Israeli stocks recently.  Many of them continue to do very well, but it is not a bad idea to also take a broader brush approach to a country.  Investors can do this through exchange traded funds like some of the ones mentioned above.

All data from Best Stocks Now app.

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