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Does anyone have any recommendations for emerging market funds for a Roth IRA? Yes, I know that I can look it up myself (for all the crabby people on here) but if anyone with a personal experience or otherwise could give me some recommendations let me know!
You can find similar articles about Brazil and Korea, as well as other darlings of the emerging markets crowd. Don't get me wrong, I am sure that some companies in those countries are well run and will grow faster than their competitors, but when you invest in a country (or group of countries) through an ETF or mutual fund you are really diluting the well run firms with the crummy ones (of which there are ALWAYS more of...). The other GOTCHA with emerging markets investing is you are dealing with some often complicated CURRENCY PLAYS that reflect the global bankers biases against the monetary policies of some countries. VERY difficult to build a strategy that minizes those effects...
It is probably better to find WELL RUN firms that have significant growth potential either among established firms in more stable countries OR find a handful of well run firms in the countries that you are willing to pour over the details of their financial shifts. Lots of work, and in my humble opinion, effort that is better spent finding growing firms here in the US...
You can find similar articles about Brazil and Korea, as well as other darlings of the emerging markets crowd. Don't get me wrong, I am sure that some companies in those countries are well run and will grow faster than their competitors, but when you invest in a country (or group of countries) through an ETF or mutual fund you are really diluting the well run firms with the crummy ones (of which there are ALWAYS more of...). The other GOTCHA with emerging markets investing is you are dealing with some often complicated CURRENCY PLAYS that reflect the global bankers biases against the monetary policies of some countries. VERY difficult to build a strategy that minizes those effects...
It is probably better to find WELL RUN firms that have significant growth potential either among established firms in more stable countries OR find a handful of well run firms in the countries that you are willing to pour over the details of their financial shifts. Lots of work, and in my humble opinion, effort that is better spent finding growing firms here in the US...
Thanks for the advice. I'm 23 right now so I'm willing to take extra risk.
You can just as big a "pay day" with funds invested in start-up biotech, info tech, consumer electronics and similar sectors. The big difference is that you can generally get info about the operation of those firms that is NOT clouded with all kinds of political risks.
Think of it this way -- would you investment in some hi tech firm be DEVALUED because of political upheaval , is Barack Obama going to have riots in the streets that make people run from the CURRENCY of the US? That has and will continue to happen in places like Brazil, India, Korea, etc...
I am not saying do not invest in growing firms, what I am warning against is that the return on investment in "emerging markets" rarely if ever reflects the simple value of the firms...
I suppose there are some countries that do not have much political downside risk, but they are so few in number, and the costs of doing business there are probably as high IF NOT higher than the US. Think of Canada -- it is our largest global trading partner. It has a stable government. It population is a FRACTION of ours. Their social programs are different than those in the US. It is not any easier for Canadian firms to borrow money / raise capital for expansion that US firms. That is why "Silicon Valley" is preferred for start-up businesses than Toronto, Vancouver, Edmonton etc...
Ireland has gone from DARLING TO DISASTER, would you think that Turkey is any better?
Really the best run companies, whether they are based in the US or Japan or Germany are already growing their own business in the 'emerging markets" faster than some shaky local firm can. It is not just about the "consumer side" either. Firms like IBM have vast local sales networks in Europe, Asia, Latin America. They sell servers and system software around the globe on a scale that cannot be beat. Firms like Siemens outfits hospitals and power plants around the world. Toyota sells everything from pickups and mini cars to Lexus sedans to drivers in every part of the world...
I'm not saying don't put a dime into "emerging markets" just that to get good returns from those investments you need to DO A WHOLE LOT OF WATCHING of many more variables. The effort you need to watch all those variable probably is not GOING to pay off like it would just focusing on firms that are less likely to move in response to political events and such..
Does anyone have any recommendations for emerging market funds for a Roth IRA? Yes, I know that I can look it up myself (for all the crabby people on here) but if anyone with a personal experience or otherwise could give me some recommendations let me know!
Try the Morningstar website.
I have all American Funds in my Roth. Do you really want to put volatile funds for your retirement?
Does anyone have any recommendations for emerging market funds for a Roth IRA? Yes, I know that I can look it up myself (for all the crabby people on here) but if anyone with a personal experience or otherwise could give me some recommendations let me know!
buying one fund in one sector or area is not investing,its speculating.
Does anyone have any recommendations for emerging market funds for a Roth IRA? Yes, I know that I can look it up myself (for all the crabby people on here) but if anyone with a personal experience or otherwise could give me some recommendations let me know!
The problem with these funds, besides the fact that many emerging markets countries are as corrput or worse than the US...is that I don't know of any that don't charge a load.
I have Oppenheimer Emerging Markets A in my workplace retirement plan, but the load is waived. I keep it to 10% of my plan and it gets automatically rebalanced every quarter.
You might want to try a mix of different country ETFs instead of mutual funds.
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I like EEM too (And EFA) But I use their Vanguard Equivalents too VWO & VGK (you can use them in the case of a Wash Sale need)
With the ETF's you want HIGH volume trading and LARGE funds (so you can get a buyer on a BAD day). Stick on some trailing stops to lock in profits. You can look at the daily / weekly delta, and keep an eye on the 20 and 50 day moving averages to set your trailing stops. (You might want to modify them on occasion... I use a % rather that a fixed # of points)
I would be more careful with individual country ETFs (They can have a Disaster / or a political disruption.) That said, I do keep select countries that are pretty stable and poised for a solid future (and financial centers of their region... they are the most 'honest'.... maybe...)
Basic rule, no more that 10% of total invest-able $$ in any one sector, no more than 5% in any one holding. Little tough when you are young, but just be smart and watchful and TAKE SOLID ADVICE... my kids have run their self directed ROTHs since age 12 (they are doing MUCH better than I). You might want to keep your eye on IBD and note their Daily Market summary (Big Picture). With the current volatility, they are a bit late on the calls, BUT they saved their readership from the recent GIANT crash. It is a pretty good read, and the IBD 100 is doing well. (IBD is one of many tools', keep your tools sharp and current)
I use EEM. I enjoy the commission free trades. Wash doesn't apply to IRAs unless your purchase of shares within your IRA counters a non-retirement sale of the same stock.
How about international/global equity funds? Are those good to invest in?
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