Monday, 15 July 2013

Emerging Markets Offer Profitable Investment Alternatives

The global economy is based upon the principles of consumer supply and demand. The more world-wide consumers, the bigger the demand and thus a bigger supply is needed to meet it. Since the turn of this century, the world’s economy has doubled in size and this is due mainly to the growth of the emerging markets around the globe. Between China, India, Brazil, Russia, the UAE and the continent of Africa, their growing consumer bases total close to half the entire world’s population and this increase in demand has created many opportunities for investors and businesses alike, to capitalize on it.

When the demand for consumer goods rises, the demand for hard assets, needed for the manufacturing and transport of them, also increases at the same time. These include precious metals, oil and gas, commercial real estate and even shipping containers required to transport the goods all over the world. Hard assets are considered to be alternative investment options and have been delivering above-average returns for their investors for many decades and it is only recently that they have become more accessible and affordable for the average person to invest in.

When it comes to investing, it is always wise to look at growing markets and sectors to increase the odds of generating a positive yield at the end of the day. These days, the western markets have been mired in a financial fiasco that their banking and market leaders brought upon themselves and have been trying to work their way out of it since 2008. In the mean-time, appealing emerging markets around the world have been attracting much more foreign business and investments than ever before. The main reason is that they are growing at a collective rate of between 5 and 10 percent since the year 2000, while growth in the United States and Western Europe have been relatively flat overall, taking into account their two major market slumps they have found themselves in over the last 13 years.

There have been a flood of investors who have put their money into alternative options in recent years and the total now stands about $7 trillion dollars and that number is growing as the global opportunities for investors continues to grow along-side the global economy. Investors and businesses are always on the lookout for good investment opportunities and lately, the majority of these are found in the world’s emerging markets. Many are enjoying double-digit returns on a constant and consistent basis, as these new consumer markets continue to generate more prosperity that leads to increased spending; that in turn requires more supply to meet the rising demand. When investing in anything, timing is just as important as what you invest in. These days, the best time to invest in emerging markets is now, particularly since it is expected that the global economy is once again forecast to double by 2020.

No comments:

Post a Comment