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Martin here with the answers to my quick quiz.
If you’re among the many that thought the green line in this chart was the ETF linked to the Chinese stock market, you guessed incorrectly.
It’s actually the Brazil ETF (symbol EWZ), up a whopping 65 percent so far this year.
A possible source of confusion: The Shanghai Stock Index HAS soared a lot more, but the China ETF (FXI), due to its portfolio of steadier, less volatile Chinese stocks, is up “only” 40 percent.*
Meanwhile, nearly everyone guessed correctly that the WORST-performing major stock market is right here in the United States: the Dow Jones Industrial average was up a meager 3 percent year to date.
Bottom line: For every $10,000 investors have made in the Dow this year, they could have made $133,000 in the China ETF … and $217,000 in the Brazil ETF!
Reason — and this nearly everyone answered correctly — the major economy with the weakest growth is the United States; and the major economy with the strongest growth is China.
Plus, as, I’ve stressed in my recent articles, the major economy that’s been among the first to recover from the recent slump is Brazil.
Now, for the final question I asked …
Which would you prefer to invest in?
A country where the market has had the best
performance so far this year? Or one which may be
lagging but can be bought more cheaply?
Doug says: “I would prefer to invest in an economy that is stable and has direction from its government.”
Bill and several others want “the one that will have the best performance next year.”
Still another reader writes that he’d go for “one which may be lagging right now but is underpriced and will shoot to the forefront in the next 12 months.”
All good answers!
Our team of international experts actually recommends a mix of both: Investments in countries that have great momentum and a proven recent track record … PLUS those that may have lagged in recent months but offer better value.
And in our Weiss Global Forum this coming Thursday, they provide specific, actionable recommendations for each.
But you have only a few more days to take advantage of our free registration. Here are the specs:
Title: The Weiss Global Forum
Date: Thursday, August 13
Time: 12 Noon Eastern Time (9 AM Pacific, 5 PM GMT)
How: Video streaming online
Topic: Global profit opportunities
Registration: No charge for readers. Click here.
We look forward to seeing you there!
Best wishes,
Martin
* FXI is comprised of Chinese companies listed on the Hong Kong Stock Exchange that have issued class “H” shares denominated in Hong Kong dollars and available to international investors. The Shanghai Stock Index is comprised of companies listed on the Shanghai Stock Exchange issuing Class “A” or “B” shares, denominated in yuan and traded only by mainland Chinese investors.
{ 3 comments… read them below or add one }
I have found myself stuck with 250 shares of SKF that I bought at an avg. of $66.
What are the chances that the stock will ever get back to that level?
Should I throw good money after bad, trying to bring down the avg. cost per share,
hoping SKF will more easily reach a lower target price?
The avg. price of SKF over the years seems to be over $50.
Want to know how to invest in a stock offered by China. How can I know if this company pays dividends. Help please.
Thank you for an outstanding video conference. The first 10 minutes confirmed my greatest fears–that our massive debt will cause future generations to live a life of greater challenges and fewer rewards than I have had!!