With aggressive monetary easing policies supporting growth across Europe and Asia, investors can take a look at materials-based economies that help fuel the expansion, along with related international exchange traded funds,
Europe, Japan and China are seeing improvements after the governments enacted loose monetary policies to stimulate their economies, writes Scott Colyer, chief executive of Advisors Asset Management, for InvestmentNews.
“One thing the world has learned is that asset prices generally love quantitative easing,” Colyer said. “Europe and Japan both have engaged in massive asset purchases, while China has lowered interest rates and bank reserve requirements.”
While these markets are some of the more obvious plays, Colyer argues that investors should consider an asset allocation plan that can help spot “future” bright spots before they shine. For instance, as European and Asian economies expand on monetary stimulus, materials-based economies could gain on greater demand for raw resources. Specifically, Colyer points to signs of a bounce in Latin America and Australia.
“These markets are very inexpensive and we expect them to follow the recovery in Europe and Asia, as demand for commodities begins to recover,” Colyer added.
Investors can also access these foreign markets through ETFs. For instance, the iShares Latin American 40 ETF (NYSEArca: ILF) and SPDR S&P Emerging Latin America ETF (NYSEArca: GML) both provide broad exposure to Latin American economies. [Loving Leveraged Latin America ETFs]