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With every passing day, the outsized economic growth that Asia's emerging economies are currently experiencing makes them harder and harder for investors to ignore.
Some of the fastest-growing countries in the world are in Asia. China, India, and the "newly industrialized Asian economies" – Hong Kong, Singapore, Taiwan, and South Korea,– led the world in economic growth in 2010, according to International Monetary Authority data.
China, India, and the ASEAN nations – Vietnam, the Philippines, Indonesia, Malaysia, and Thailand – will lead global economic growth in 2011 and 2012, according to IMF projections.
Growth in China has been so strong it is starting to stoke inflation, leading Chinese monetary authorities to raise interest rates. That has served to cool investment demand for Chinese stocks recently, pushing the benchmark Shanghai Composite Index to a four-month low in late January.
Stronger growth in emerging Asian economies has been a part of the global economic landscape for quite some time, yet there are surprisingly few exchange traded funds (ETFs) that offer investors an easy way to gain exposure to the region.
There are several Asia/Pacific ETFs, but these ETFs tend to be dominated by large-cap Japanese and Australian companies, most of which do business globally and therefore do not make a good proxy for emerging Asian growth.
For specific exposure to emerging Asia, one option is the iShares S&P Asia 50 fund, which garners a marketweight ranking from S&P's proprietary ETF ranking methodology, which incorporates not only an analysis of past performance but also the likely future prospects of the underlying holdings, as well as costs and risks.
