1. You travel internationally 

2. You like what you see in their economy 

3. You start thinking how you can “invest” into their economy 

4. You look into investing in “emerging markets” 

5. You invest and realize how up and down the market is 

6. You realize that this is a great diversification of your portfolio 

Let us break this down, you decide to travel internationally and have a blast, now you want to figure out a way to invest in the local market because you see a potential. You go back home and figure out you can invest in a fund called “Emerging markets” you put some money in and realize how up and down this fund is but you are blessed because you have diversified your portfolio. 

What are they?

Emerging markets are countries that are still emerging and growing in their Gross Domestic Product rate, now not everyone agrees on what emerging markets are but below are a list of countries that the general market references  as emerging markets. 

Brazil, Chile, China, Colombia, Hungary, Indonesia, India, Malaysia, Mexico, Peru, Philippines, Poland, Russia, South Africa, Thailand, and Turkey.

Why? 

People usually invest in emerging markets in the prospects of higher returns, as their economies grow faster due to a higher rate of GDP. This offers a different level of diversification to your portfolio as you are invested in foreign economies and their currency. 

The Good, The Bad, The Ugly 

Emerging markets are a great way to diversify your portfolio and allow you to invest in markets that you otherwise would not be able to (Good) 

There is a limited supply of emerging market countries that you can invest in, limiting your diversification (Bad) 

Emerging markets tend to be more volatile and sensitive to currency markets both the upside and downside is greater than most investments (Ugly) 

Overall getting involved in emerging market funds is a good way to diversify your portfolio, you can easily search and see funds labeled "Emerging Market" as well and consult with a professional to see if these funds, generally riskier, are right for your needs.