The Best Ways to Invest in BRICs, Part 1

BRIC is an acronym for the combined economies of Brazil, Russia, India, and China. These developing countries have seen their stock markets plummet along with those of the rest of the world, but now is a great time to invest in them. Their stocks are oversold and they still have high growth potential. Plus, BRICs typically have lower labor and production costs, so companies in other countries are looking into the opportunities they offer for foreign expansion and trade.

Today, let’s look at Brazil and Russia, which are destined to become the world’s leading producers of raw materials.

In the past, Brazil had high inflation, but the economic climate has been quite stable under President Lula da Silva. And the land is rich with natural resources. The ethanol industry, in particular, is very strong and growing. The world is seeking alternative sources for traditional fuels, and Brazil is well positioned to take full advantage of this.

The best way to play Brazil: iShares MSCI Brazil Index (EWZ). This exchange-traded fund holds a nice basket of Brazilian stocks and seeks to mirror the Brazilian stock market as measured by the MSCI Brazil index.

Russia has some big negatives – with political issues and organized crime among the main concerns. And investors don’t like the idea of investing in companies that could be nationalized overnight. But Russia’s energy sector is still a powerful force in the world, and its cheap assets are quite attractive. Russia is one of the largest producers of palladium, platinum, diamonds, nickel, and gold, making it a natural resources powerhouse that should do well as commodity prices recover.

The best way to play Russia: Market Vectors Russia ETF (RSX). This exchange-traded fund holds a nice basket of Russian stocks and seeks to mirror the Russian stock market as measured by the DAX Global Russia+ Index.

[Ed. Note: Investment expert Ted Peroulakis and 8 of his fellow moneymakers will be gathering in Miami this June to share exactly how you can use their top recommendations to make a fortune in today’s market. Get all the details here.]

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