BMO Global Strategist Addresses Frontier Market Strategies at Palm Beach Summit
February 05, 2013 11:01 ET
BMO Global Strategist Addresses Frontier Market Strategies at Palm Beach Summit
Risk Can Be Viewed in a Top-Down Manner Reports Sandy Lincoln at Emerging Markets Investment Forum
CHICAGO, IL--(Marketwire - Feb 5, 2013) - According to Sandy Lincoln, Chief Market Strategist for BMO Global Asset Management, who was a speaker at the Emerging Markets Investments Summit held recently at the Ritz-Carlton Palm Beach, the introduction and evolution of the frontier markets as an asset class for investors parallels in many respects what happened 25 years ago in emerging markets.
Lincoln noted that becoming familiar with economies, markets, companies and characteristics of the frontier countries can provide opportunities for several attractive features: valuations are lower than major and emerging markets, dividends are higher, correlations are low to U.S. and emerging markets and are very "under" researched.
"Frontier markets are largely undiscovered, yet they represent ten percent of the world's population, five percent of its gross domestic product, but just half a percent of the total world stock market," he explained.
"In addition, these economies grow over five percent per year and carry a favorable demographic ratio of working age to dependent age population. While this backdrop provides opportunities for stock selection, prudent policies and guidelines should be put in place regarding diversification parameters by country, sector and company. That applies to the allocation percentage as well."
The Emerging Investments Summit 2013 brought together thought leaders and solution providers to an interactive networking event, which included key trends and opportunities in global currency markets and how China's race to rekindle growth will impact the global economy.
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