Investing with exchange traded funds is one way to participate in markets around the world. There are several emerging market ETFs available for investors. Two of which are Vanguard Emerging Markets (VWO) and iShares MSCI Emerging Markets Index (EEM).
Capital flows to Brazil, Russia, India and China (BRIC) have been strong in recent years because of the widening trade surplus and strong foreign direct investment. Foreign capital is also attracted by the high domestic interest rates in countries such as Brazil.
The developing deceleration in global growth points to lingering risks for emerging markets. However, falling unemployment and rising consumer credit growth is pushing up private consumption growth to a structurally higher level.
Emerging market fundamentals indicate that share prices have not yet reached a secular top like they did in 1994. For example, the current and forward multiples are currently on average 12 compared to 26 in 1994.