3 Single Country ETFs With Big Long-Term Potential Upside
3 Single Country ETFs With Big Long-Term Potential Upside
Invest in Countries Starting Bull Markets
Research proves that undervalued equity markets achieve higher future returns over longer term investment horizons.
Studies show that investing in markets which have just been through a bear market, and their valuations are low, is one of the best ways to grow your investment capital.
In 2012 Ireland was one of the countries with lowest PE ratio and a couple years later and 100% rise in the Ireland ETF (EIRL), it is now the second most overvalued country.
Every year there are several markets that are bottoming and starting a new bull market. The key is finding them and being prepared to lock up some of your investment capital in these longer term investments.
I believe the best way to be successful as an investor is to actively manage your portfolio. And when I say actively manage it, I mean, you should be rotating your money out of underperforming stocks, sectors, commodities, and index positions and moving that money to fresh investments which more room to rise.
Sometimes, the fewer positions you hold in your portfolio can make a dramatic impact on your portfolio volatility, time commitment, stress levels and performance.
Diversification between a small selection of investments and strategies is vital. This is not rocket science, anyone can do it.
Anyway, let's get back to undervalued markets...
You have to invest in markets and sectors that have just gone through a bear market. By doing so you can look forward to years of upside growth.
Cheapest Markets and Most Expensive Markets
This table shows the valuations of world markets with the most recent data available:
PE Ratio By Country Chart
Looking from an evaluation stand point and long term investing Russia, China and Greece are the most undervalued. And if we take an average PE ratio of the majority of counties of 20, then we can calculate a rough percent return each country should provide in the coming years.
Keep in mind, these markets can still be volatile and if you are a short term trader, it's best not to short-term trade these primarily based off fundamentals and valuation.
Charts of Undervalued Country ETFs
3 long-term names that I like here are Russia ETF (RSX), China ETF (FXI) and the Greek Market ((GREK) is a Greece ETF).
These charts just show a simple snap shot and their first upside target before they run into some long term resistance.
RSX Long Term Chart
FXI Long Term Chart
Greece Long Term Chart
Long Term County Specific Investing Conclusion:
In short, this report is simple and uses a logical strategy. Again, it is critical to have a diversified portfolio with completely unrelated investments (different countries) and also to use different investment strategies and time frames to balance portfolio volatility.
I believe you should have long term holdings and short term holding using both long and short positions. Short positions allow you to profit from a falling market, and some of the biggest and fastest money can be made with this strategy and is a vital strategy within an automated investing system.
Courtesy of AlgoTrades.net