Checking in on the BRIC ETFs | ETF Trends

Some investors use exchange traded funds indexed to the so-called BRIC nations — Brazil, Russia, China and India — for targeted exposure to emerging markets.

Growth-focused investors often look at BRIC countries and the term was coined back in the early 1990s as individuals began to warm up to investing overseas.

The BRICs have managed to maintain steady growth even amid the global credit crisis that still plagues many developed nations today. Analysts say that looking at a BRIC economy from a different angle is helpful for those investors interested in a growth approach.

“Specifically, we (are) looking for those countries that are looking to maintain or lower rates of taxation on capital alongside a policy of gradual currency appreciation. Predictability on tax rates is generally positive; meanwhile currency appreciation is a powerful ally in the fight against inflation, which has become a problem common to emerging markets this year,” says Vlad Signorelli, Global Research Director at boutique investment research firm Brettonwoods Research LLC in New Jersey. [BRIC Economies Demand Bigger Role.]

Analysts say that the importance of GDP growth is less important when analyzing a country than actual equity market performance. Instead, investors should study “policies at the margin that encourage economic growth when trying to predict outperforming global markets,” says Signorelli, on Forbes.