Small-caps outperforming large-caps after downturns isn’t a phenomenon restricted to our own borders. Emerging market small-caps are powering ahead, too.

New research from S&P Indices shows that right now, small caps in emerging markets out outperforming their larger counterparts. Ray Clancy for Investment International reports that the S&P Emerging SmallCap Index has notched a 16.6% 10-year compound annual growth rate. [Asia ETFs: Fast Growth May Have Consequences.]

If you’re interested in emerging market growth, investing in their small-caps can be a great way to get direct exposure to the local economy and the spending habits of emerging market consumers. [Consumer ETFs Get A Lift From Emerging Markets.]

Despite that, the report notes that many investors don’t have exposure to these small-caps in their portfolios. A number of emerging market small-cap ETFs have come out in recent months, so there’s no longer an excuse to not consider these allocations in your portfolio.

Tony Wilbon for Commercial Finance Group reports that as more capital flows into these global markets, they will continue to be the growth engines of the globe.

Among your options for playing these markets now include:

  • Guggenheim Small Cap China (NYSEArca: HAO)
  • SPDR S&P Emerging Markets Small Cap (NYSEArca: EWX)
  • EG Shares India Small Cap (NYSEArca: SCIN)

Tisha Guerrero contributed to this article.

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