The risks of frontier market investing include political and economic instability that occurs in these nations. Dividend payouts and overseas tax distributions should also be considered. [Vietnam ETF Down On Year]
Dividend ETFs have been a popular investment theme this year due to the low yield economic conditions. Investors have been seeking out any possible yield for return on their capital and dividends have been more rewarding than the 10-year Treasury note. Emerging market dividends have offered investors a way to gain yield while getting international exposure for better portfolio diversification. [Emerging Market Dividend ETFs]
Key factors that investors should acknowledge before investing in a frontier market ETF are the possible return on investment, the volatility of the pool of stocks and the cost or expense ratio, which takes away from principle.
Tisha Guerrero contributed to this article.