It is no surprise that the fastest growing economies are in the emerging markets. For the last six months, some of the best performing exchange traded funds (ETFs) were also those that covered the developing world.
Thailand. The Thailand Development Research Institute projects that the Thai economy could grow 6.4% to 7.2% this year, according to MCOT. The economy is estimated to expand by 3.5% to 7.1% for 2011. Inflation is expected to stay within 3% to 3.5% for 2010. The only risk to the country’s growth may come in the third or fourth quarter if political violence escalates. [Thailand ETF Rises Above Political Turmoil.]
- iShares MSCI Thailand (NYSEArca: THD): Up 31.4% in the last six months
Colombia. The International Monetary Fund (IMF) projects growth of 2.5% for 2010 with inflation remaining around 2%-4%. Stronger policy and institutional framework during the financial crisis has helped the country pull out of a downward spiral. Legitimate industries such as mining and oil have taken off, and companies are looking to this country to set up business benefit from higher commodity prices. Colombia is forecast to attract about $10 billion in foreign direct investment this year, up from about $7.5 billion last year. [Despite Growing Debt, 5 Reasons to Like Colombia ETF.]
- Global X/InterBolsa FTSE Colombia 20 ETF (NYSEArca: GXG): up 25.3% in the last six months
Malaysia. Malaysia’s exports grew at the slowest pace in the last seven months due to concerns over Europe’s debt crisis and an economic slowdown in the United States and China, the latter two accounting for Malaysia’s biggest markets. However, exports still rose 17.2% in June from a year earlier. But, the slowdown has led analysts to believe that for the time being, interest rates will remain at current levels. In order to build upon some of its strengths, Malaysia’s government is trying to develop synergies with India and Singapore. [Why Malaysia ETF Is One of Asia’s Best.]
- iShares MSCI Malaysia Index Fund (NYSEArca: EWM): Up 19.6% in the last six months
Chile. This country produces more copper than any other nation in the world. It produces five times as much as the United States. Many large tech companies have set up shop in Chile. Its economy has rebounded strongly from last year’s recession. In fact, The Economist forecasts that the economy will grow at +4.7% this year and +6.0% next year. [3 Reasons Chile’s ETF Is Hot.]
- iShares MSCI Chile Investable Market Idx (NYSEArca: ECH): Up 19.5% in the last six months
Indonesia. Stable growth prospects and a better return on equity have taken Indonesia’s stocks to the head of the pack of Asian countries and shows no signs of slowing. Indonesia’s economy may have expanded 5.8% in the first half of this year and may grow 6 % in the second half. The bad news is that inflationary pressures are expected to rise through the end of this year. [Why Indonesia ETF Is Ahead of the Pack.]
- Market Vectors Indonesia Index ETF (NYSEArca: IDX): Up 18.6% in the last six months
We uncovered the top-performing emerging market ETFs by using the ETF Analyzer, which you can also use to sort ETFs by other criteria, including yield, expense ratio and short-term performance.
For full disclosure, Tom Lydon’s clients own shares of EWM.
Max Chen contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.