Frontier market exchange traded funds (ETFs) could see greater inflows as investors seek out riskier assets with the promise of potentially higher returns.

According to Karim Rahemtulla for InvestmentU, Vietnam, Thailand and Combodia are three promising, up-and-coming, “pre-emerging” markets. You can get your exposure to two of tham directly via ETFs: Market Vectors Vietnam (NYSEArca: VNM) and iShares MSCI Thailand (NYSEArca: THD).

However, the three frontier markets suffer from three common characteristics that hinder growth – poor infrastructure, lack of a viable tax system and widespread corruption.

Still, the problems only means that the region is ripe with opportunities for change. For instance, Vietnam’s infrastructure, including roads, financial system, retail and utilities, are areas with great potential growth.

A survey conducted by RBC Capital Markets and the Economist Intelligence Unit found that asset managers project stronger growth from small Asian economies, reports Paula Vasan for aiCIO. Hong Kong, Singapore and South Korea were among the top economies most likely to experience improved growth projections for 2011.

  • iShares MSCI Hong Kong Index Fund (NYSEArca: EWH)
  • iShares MSCI Singapore Index (NYSEArca: EWS)
  • iShares MSCI South Korea (NYSEArca: EWY)

Double-digit returns, rising incomes and rapid economic growth have attracted increasing inflows of foreign investment and continue to make the emerging markets a top 2011 investment. The Institute for International Finance (IIF) expects equity portfolio flows to emerging markets to hit $186 billion this year, or more than double the $62 billion annual average between 2005 and 2009.

For more information on the frontier markets, visit our frontier markets category.

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.