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The Massive Undiscovered Opportunity in Emerging-Market Stocks

By Dr. Steve Sjuggerud
Tuesday, April 14, 2015

Just more than a month ago, I recommended buying emerging-market stocks to subscribers of my True Wealth Systems letter...
Readers are up 15% since that recommendation. (I recommended a double-long ETF.)
The important news here is, you haven't missed out yet – at all.
There's still plenty of upside potential in emerging markets...
Triple-digit percentage gains are easily possible when emerging markets get going. And right now – after five years of being "dead money" – they're just getting going again...
In the past five years, emerging markets have been dead money...
The main U.S. stock market index is up 73% over the last five years. But over the same period, the leading emerging-markets fund – the iShares MSCI Emerging Markets Index Fund (EEM) – is actually down in price. Take a look:

The gap really started three years ago... U.S. stocks took off. And emerging markets have completely missed it...
That has made emerging markets incredibly cheap relative to the S&P 500.
They trade for around 26% less than U.S. stocks, based on earnings. And emerging-market stocks pay dividends of around 2.5%... 29% higher than U.S stocks.
Even though emerging markets are a much better deal, most folks aren't interested in emerging markets today.
Investors are scared of places like China, Russia, and Brazil. Now, after years of underperformance, no one is buying.
So emerging markets are cheap and hated.
Most important to me, just recently, they have entered an uptrend. Those three things are what I hope to see when I enter a trade.
Recently in DailyWealth, I told you about a great way to buy emerging markets... I wrote about the WisdomTree Emerging Markets Equity Income Fund (DEM).
This, to me, is an incredible opportunity. Our total upside potential here is in the triple digits – and you'll earn 5% in dividends while you wait.
This is a trade you don't want to miss. If you have new money to put to work... or if you're looking to allocate money outside of the U.S., DEM should be the first place you start...
Good investing,

Further Reading:

Yesterday, Steve explained why it's still not too late to invest in U.S. stocks. "My friend, the opportunity in U.S. stocks has not peaked yet," he writes. Find out why here.
Steve also told readers why he's not buying cheap oil stocks yet. "I do like some of what I see (in the energy sector)," he writes. "I am just not a buyer – yet." Get the full story right here.

Market Notes


Today's chart takes another look at the soaring popularity of organic food...
Back in February, we noted the rising popularity of organic food. As we mentioned, organic food sales in the U.S. in 2013 increased 11.5% over the previous year, totaling more than $35 billion in sales. Nowadays, it's tough to find a grocery aisle and not see labels with "organic" and "natural" on them.
A great example of this trend at work is the share price of WhiteWave Foods (WWAV). You may not be familiar with the company's name, but you surely know some of its top brands, which include Land O' Lakes, Horizon Organic dairy products, Silk almond milk, and International Delight coffee creamers.
As you can see below, WhiteWave's business is booming. Shares are up more than 180% in the past two years. And since our late-February note, shares are up another 13% – hitting a new all-time high yesterday. It's still a bull market in organic food.

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