What are Emerging Markets?

Emerging markets are usually considered to be in a transitional phase toward developed-market (i.e., industrialized) status and in the process of building liquid equity, debt and foreign-exchange markets. Over the last twenty years emerging markets have increasingly formed a greater part of investment strategies globally.

As some of the world's largest growing economies, emerging markets play an increasingly important role in the global economic, political and social landscapes. Many are regional powerhouses with large populations and ample supplies of key natural resources such as oil, metals and timber. As emerging economies grow, they look to expand their infrastructure, create new markets and develop their financial systems. Burgeoning middle classes and rising consumer markets give these economies different avenues of growth potential compared to developed markets. As trading with other nations increases, liquidity, equity, debt and foreign-exchange markets broaden to facilitate the growth in trade.  

HSBC believes emerging markets can offer a full-range of investment opportunities and can be one way to tap into:

Evolving economic growth prospects
Almost three fourths of global GDP and nearly half of the world’s market capitalization lies outside the US

Burgeoning invesmtent opportunities
Investing globally may provide exposure to potentially faster growing foreign investment opportunities, younger middle class populations and rising consumer markets

Improving portfolio diversification
A global portfolio may mitigate investment risk and tap into potential long-term growth opportunities

What are Frontier Markets?