U.S. retailers aren’t the only developed market companies hunting for growth opportunities in emerging markets. The time is ripe for Australian retailers to migrate overseas and expand their market share, reports Michael Baker for The Sydney Morning Herald. Retailers loath to expand are mostly wary about taking their brand names too far away from home, but they can always gain entree to emerging markets by licensing their brands to local “brand managers.” [5 ETFs for the New Retail Climate.]
This way retailers gain access to a far off location with the added benefit of handing over operational and real estate risk to the licensee. However, there is always the drawback that the licensee won’t perfectly match the brand name concept.
How can you leverage this into an ETF play? You have several options; global consumer ETFs give you exposure to international shoppers, while single-country funds give you a play on a strong consumer base in particular emerging markets. After all, if consumers are spending, it’s as sure a sign as any that an economy could be on its way to growth. If you want a broader fund with mitigated risk, look for international retail. If more oomph is what you’re after, a single-country fund will give you more targeted exposure.
For more information on emerging markets, visit our emerging markets category.
- iShares S&P Global Consumer Staples (NYSEArca: KXI)
- iShares S&P Global Consumer Discretionary (NYSEArca: RXI)
- SPDR S&P International Consumer Discretionary Sector (NYSEArca: IPD)
- SPDR S&P International Consumer Staples (NYSEArca: IPS)
- iShares S&P India Nifty 50 (NASDAQ: INDY)
- WisdomTree India Earnings Fund (NYAR: EPI)
- PowerShares India Portfolio (NYSEArca: PIN)
- PowerShares Golden Dragon Halter USX China (NYSEArca: PGJ)
- iShares FTSE/Xinhua China 25 Index (NYSEArca: FXI)
- SPDR S&P China (NYSEArca: GXC)
- Global X China Consumer (NYSEArca: NYSEArca: CHIQ)
Max Chen contributed to this article.