If there’s anything the financial industry loves, it’s a good acronym. For a long time, the BRICs and their exchange traded funds (ETFs) were the hot acronym in town. Now some wonder if it isn’t time for a new string of pronounceable letters: the CIVETS.
Taipan Daily for Benginza explains that you can expect some of the CIVETS economies (Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa) to be among the world’s hottest markets in the decade to come. In fact, they may have the potential to generate the kind of performance that the BRICs have over the last decade – but only if you pick the right markets at the right time. [How to Follow the Trends.]
Alas, there is no CIVETS ETF – at least, not yet – but there are plenty of single-country plays on these countries. Many of these funds have performed quite well in recent months, most notably Indonesia, which is up 22.7% year-to-date:
- iShares MSCI South Africa (NYSEArca: EZA): up 17.4% in the last year
- iShares Turkey (NYSEArca: TUR): up 30.8% in the last year
- Global X/ InterBolsa FTSE Colombia Index (NYSEArca: GXG): up 32.6% in the last year
- Market Vectors Egypt Index (NYSEArca: EGPT): down 25.5% in the last three months (launched in February)
- Market Vectors Vietnam (NYSEArca: VNM): down 0.1% in the last six months (launched last August)
- Market Vectors Indonesia Index ETF (NYSEArca: IDX): up 35.8% in the last year
These markets are all considered to be emerging and carry risks, often in the form of political instability, so be sure to have a strategy when playing the CIVETS or any other frontier/emerging market you choose. One way to do this is with our alerts tool, which well send you an email when a trading signal is reached.