A promising and attractive Young Frontier Market – Nigerian ETF

The Global X Nigeria Index ETF (NGE) is one of the Index's that has a long term association with growth potential. It provides the exposure to the most influential companies in Nigeria that bring out some good amount of revenues. Keeping in mind the fact that this ETF is a latest addition in the basket of financial vehicles, it still is considered a promising fund.

Though this African country is the world's largest oil production nation, its social and political scenario and series of issues of civil unrest and corruption have not let it score too great. Nevertheless the population of this nation touches 160 million and the working potential ratio of this population is the targeted group with huge expectations. The new economic liberalization reform and strategy have been targeted to achieve the desired ratio of economic growth of this country. The effect of these new liberal policies can be seen in the telecom Industry which is doing remarkably well, and the privatization of the oil and gas sector has further improved the growth.

The transportation sector is being inducted with a huge amount of investment from Qatar. This country emerges as one of the biggest recipients for the Foreign Direct Investments with a golden opportunity of sharing project investment with China as well.

Interestingly the energy sector of this economy supports 80% of the revenue build up of the government.

Nigeria is an active member of the Organization of the Petroleum Exporting Countries (OPEC) and has placed itself as on the third rank of suppliers after Venezuela and Saudi Arabia, focusing on the U.S. Market and demand for Petroleum.

41% and 24% of the Nigerian Index Fund is dominated by the Financial Sector and the energy sector respectively followed by the consumer discretionary. A growth of 6% in the GDP is anticipated this year and Gold Sachs has analyzed that Nigeria is expected to reach a population figure of the U.S. demographically and at present is the home to 15% of the entire population of the African Continent and is the "Next 11" Country concluded by Goldman Sachs. In the month of February, Nigeria has seen a drop in the exports of its crude oil due to a slump in the demand from the U.S.

This fund is a frontier market in terms of investment opportunities and the perfect reason for investing in Nigeria with an emergent market. Here the privatization in the power sector and gas industries is the next prime reformation in the economy, where its companies are planned for further privatization. The hydro-power projects in Nigeria are being invested in by China.

The southern part of this nation has adopted the capitalist way and is now on the verge of economic development, poised as the future booty of revenues. One of the hitches that come along with this economy are that it still does not prove to be a good market for banks because it is a relatively poor nation and is encircled with violence that subdues the travel and hinders the trade , a basic necessity for the up-liftment of the economy. It is in earnest need for economic liberalization and a power packed performance from its strong and motivated workforce. Namely two thirds of the current population of this economy is lesser than the age of 25. A more diversified economy needs to be achieved to stabilize and strengthen the quest for foreign Direct Investment and boost the Nigeria Fund.

The Nigerian ETF is the perfect financial vehicle for those looking for  lower correlation markets but with very potential growth aspects.

HOW A $17,537 CASH INVESTMENT BECAME A $4 MILLION PROPERTY GENERATING A YEARLY NET INCOME OF $315,000!
(AND THE STEP-BY-STEP DETAILS OF OTHER OUTRAGEOUSLY PROFITABLE REAL-LIFE PROPERTY DEALS)

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Frontier Investing with Colombia Equity Traded Funds

Foreign capital which was lately concentrated in the BRIC nations (Brazil, Russia, India and China) has seen a definite even though a partial shift towards the capital markets of the frontier economies or third tier countries as they are termed. Nations like Colombia from the South of Americas is a valid testimony to this trend indicating an increase in risk appetite for volatile products on the part of both traders and investors. A sizable chunk of overseas investments has found its way through the investments in Colombian broader market products like GXG ETF as the Colombia ETFs are primarily valid bench mark bound and are easily available to first world investors.

Colombia is the world number one producer of coffee, along with this it is the world front runner in production petroleum, flowers and textiles. Its economy is growing close to 7% yearly. More positive facts about the country include a drop in unemployment numbers. Also inflation has come down to a considerable level.

Previously the country was associated with terrorism, drug trafficking and dreadful things like kidnapping but today the state's government has achieved a stable secure internal environment, regulating conditions for overall growth and is inviting direct foreign investment into the country. Investor focus has indeed seen a shift due to this country's rising middle and educated segment of society, rising domestic demand and expansion of local businesses.

FDI (foreign direct investment) in Colombia in the year 2011 rose more than 120% as compared to the figures in the preceding year. The last year saw more of it due to increase in positive trading ties with the world and transparent governmental guidelines for businesses and all forms of investment.

It is seen that the Peso (Colombian currency) is increasing in value against the U.S dollar as its economy strengthens further; this also means that investors will benefit as the price of their investment grows simultaneously.

The government is willing to improve local infrastructure like roads, transport - communication and ports etc. It has set aside approximately $ 3 plus billion for the above job.

In the year 2012 another noteworthy improvement was apparent for its country risk (includes political risk + economic risk + transfer risk + exchange rate risk + sovereign risk) was measured to be reduced than before. Security situations have improved with the demobilization of military groups done some years back. Economic and legal reforms are a top priority for the state. The government which encourages tourism and related activities has a no tolerance attitude towards most crimes in the nation and means serious business when it comes to foreign participation and infrastructure growth in Colombia.

Multiple routes are available such as ADRs (American depository receipts) of Large Cap Colombian Equity or direct investments in the Bolsa de Valores de Colombia (BVC), the national exchange. Most foreign investors, however use an inverse strategy through exchange traded funds (ETFS).

Colombia Equity funds which are attuned to an Index and invest in the top Colombian stocks that it comprises of. A fact that such products are listed on major U.S exchanges such as the NASDAQ or NYSE also provides safety assurance that the issuing company has met the United States listing and regulatory rules.

For instance a product like Colombia Global X fund follows an index based on solutions given by AG &G, Germany. Rather than outperforming the index, most pure play Colombia funds like this one, will try to duplicate its benchmark returns.  Speculation risks are further lessened through ETF investing as primarily the basket of stocks helps minimizing single company specific risk and broadening diversification and knowing that a team of managers are closely screening the performance of stocks that make up the basket is an added respite.

HOW A $17,537 CASH INVESTMENT BECAME A $4 MILLION PROPERTY GENERATING A YEARLY NET INCOME OF $315,000!
(AND THE STEP-BY-STEP DETAILS OF OTHER OUTRAGEOUSLY PROFITABLE REAL-LIFE PROPERTY DEALS)

View the original article here

Read More