The Case Against Emerging Markets

There is little argument much of this century’s economic growth will come from emerging economies. However, that doesn’t mean there will always be money to be made in them for US investors. Growth is one thing, profit is another and the return of profit is yet another. Do the powers that be in places like Beijing, Mexico City, Buenos Aires, Hanoi, New Delhi and elsewhere have US investors’ best interests when at heart? That is a difficult question to answer in the affirmative.

In this week’s Trading Perspectives, Sam and John discuss emerging market investments, some of the reasons why they have underperformed and why investing in these countries requires a lot more homework than the average US investor realizes.