Investing in Frontier Markets – Opportunity, Risk and Role in an Investment Portfolio Opportunity, Risk and Role in an Investment Portfolio

Investing in Frontier Markets is written to inform fund companies and their managers, pension and other institutional managers about the next wave of investment opportunity--frontier markets. While mature markets have posted negative returns over the past decade, the one bright spot has been the positive returns in emerging markets. The MSCI Emerging Markets Index delivered a total return of 182 percent between December 31, 2001 and December 31, 2010, compared with the MSCI World Index of developed markets, which posted a negative return of 19 percent over the same period. As emerging markets mature, the question that begs is What investor opportunity is next? The answer is frontier markets. Frontier markets offer the opportunity for investors to achieve comparable returns to the present generation of emerging markets, such as Brazil, Russia, India and China. Frontier markets include parts of Asia, Central and South America, the Middle East, sub-Saharan Africa, and Eastern Europe, and this book explains the factors underpinning the growth and success of emerging markets and why and how these will be replicated in frontier markets. Gavin Graham is a highly experienced fund manager who has a close eye on frontier markets. He sees the future potential by having hands-on information from teams who live and work in these markets. He helps guide the reader through the huge diversity that exists in these markets and explains that it is important to differentiate countries within regions by looking at economic development and wealth distribution, among other factors and fundamentals. Al Emids background in covering most financial and investing issues--including emerging markets--has largely been for financial services publications. Together the authors bring over 75 years experience and insights to the narrative. The book is a not a view through rose-colored glasses. The book outlines the key risks and how to deal with them: poor liquidity; political instability; poor regulation; currency fluctuation; volatile commodity prices; and inadequate or questionable financial reporting practices. Information will be presented in such a way that the reader will be able to make apple-to-apple comparisons of the different markets and their sectors. A well-rounded portfolio today includes emerging market funds. The well-rounded fund of tomorrow will include frontier market funds, and this book articulates what vehicles are available to the investor. The authors will make recommendations as to what markets deserve first consideration and will offer predictions as to how these markets will develop in the near and long term.

The only comprehensive guide to reaping big returns investing in the hottest new growth markets This book makes a compelling case that, just as today's well-rounded portfolio includes emerging market funds, tomorrow's well-rounded portfolio will include frontier market funds. More importantly, it alerts you to the vast opportunities and potential pitfalls of investing in frontier markets while providing expert advice and guidance on how to research and invest in the most promising frontier growth markets. Widely considered to be the next emerging markets, frontier markets, such as those of certain sub-Saharan African, Eastern European, Asian, and Central and South American countries, are showing strong signs of reaching economic critical mass. If you are an investor on the lookout for authoritative, actionable information on the next big investment opportunity, this book is for you. Provides sector-by-sector analyses that let you assess opportunities and risks in each frontier market Provides strategies and tools for determining the most efficient methods for executing, monitoring, and exiting investments Guides you through the wide diversity within frontier markets, showing how to differentiate countries on the basis of economic development and wealth distribution and other factors Features contributions from international experts Ken Rogoff, former chief economist of the IMF, Joseph Stiglitz, former World Bank economist, and Paul Matthews, founder of Matthews Asian Fund