Dangerous emerging markets

by | Jan 30, 2004 | Archives

Emerging stock markets tend to perform best during times of currency turmoil. However some are oversold and should be avoided. See these dangerous ones here.

eClub expert Michael Keppler looks at all foreign stock markets and compares every major market monthly looking at their current book to price, cash flow to price, earnings to price, average dividend yield, return on equity and cash flow return on equity compared to their average and relative vales and compares them to all other markets. Based on this research he determines which markets offer top value (buy candidates), low value (sell candidates) and which are neutral.

Based on this analysis he feels the low value (sell) emerging markets now are India, Israel, Pakistan, Peru and Thailand.

Currency turmoil requires diversification and a portion of most portfolios should be in emerging markets, However the six above are currently ones to reduce rather than add.

Watch neutrally rated markets such as Argentina, Chile, China, Egypt, Hungary and Mexico as their value ratings are neutral at this time.

Recent messages have looked at ways to protect against currency instability. Avoiding low value markets and investing in high value major markets is one way to cushion the effects of currency turmoil.

A second way is to invest in gold. See why at https://www.garyascott.com/archives/2003/11/26/948/index.html

Another way to gain currency safety is to invest in property that will appreciate. Jyske Bank for example recently reported that London property prices rose to their highest levels in 13 months. . Click here for this report

Add to this the fact that the pound has risen from 1.40 per pound to 1.73 and you can see how there are real profits rather than attractive numbers eroded by currency loss.

This is why we are taking a group to learn about real estate opportunity in old Quito, Ecuador. Details are at https://www.garyascott.com/courses/ibezecuador.html

Don’t miss next Monday’s February 2 message which includes a valuable lesson and a test!

Until then, good investing.