Identifying Emerging Investment Options for 2015
Monday 15th September 2014
While there is genuinely no such thing as a safe investment, it is possible to minimise risk and optimise your chances of earning a considerable return on your outlay. This requires careful planning and preparation, however, and even though we may only be in the third financial quarter of 2014 it is not too early to begin reviewing your portfolio options for the following twelve months. With the global economic climate continually changing, however, it can be difficult to determine long-term options for financial growth.
In the current marketplace, investors may be best served by considering the merits of developing and emerging economies. The growth of these economies began in earnest during the Great Recession, as traditional financial powerhouses such as the U.S. and UK began to experience significant decline and the Eurozone crumbled. This left a chasm into which developing economies such India, China and Brazil emerged, and while growth rates have slowed in recent times they still offer a viable investment opportunity.
Appraising the Developing Markets: Identifying Investment Opportunities
The lines that separate developed and emerging economies are often blurred, and there is always opportunity for nations to progress and upgrade their status. While there are fixed metrics such as Gross Domestic Product (GDP) and investment in public services, there is often some surprise at the categorisation of some nations. Despite its size and huge growth potential, for example, China is categorised as a developing economy. In contrast, the small island nation of the UK is classed as a developed economy, even though it is dwarfed by less affluent regions.
Another surprising inclusion is South Africa, as this is another vast and diverse nation with huge potential to evolve. It is a nation hindered by stunted economic growth and political instability, however, and this usually marks it as a poor investment option for traders. The statistics would seem to support this, as the soaring interest rates and estimated growth forecasts of just 1.8% projected for 2014 offer little in the way of encouragement to investors. Such monetary and economic inequalities can be overcome, however, and experienced investors will be more inclined to consider factors such as political stability, the potential for growth and the price at which they can invest in stocks, equities and associated commodities.
In this respect, South Africa can provide a viable investment option in 2015. Not only does it serve as the ideal template for appraising investment opportunities in emerging economies, for example, but it is also a nation in the midst of political reform and evolution. More importantly, investors are aware that the country is suffering from political instability, and this is something that will be corrected over time. So as more reasonable policies and laws are implemented, long-term growth will become a matter of time rather than a distant dream.
With a platform for growth, South Africa can finally fulfil its potential and provide a relatively safe investment haven for international traders. The same principle applies to similar economies, as large-scale countries with huge potential can thrive so long as they are afforded a foundation from which to do so. With China and India also benefitting from positive political reform, these emerging economies can harness their vast resources and offer a more diverse landscape to investors.
Editorial Contact Details - Conor Shilling