Sunday 24 September 2017

Business: A Good read but little in the way of advice for investors

The Little Book of Emerging Markets By Mark Mobius

John Mulligan

John Mulligan

Interviewed by this newspaper last week, veteran investor Mark Mobius gave some interesting insights into his thoughts on investing in what he describes as 'Frontier Markets'.

They include nations such as Nigeria and Vietnam, where he hopes high risk will equal high returns. Mobius, who is executive chairman of the Templeton Emerging Markets Group, oversees about $50bn (€40bn) in funds.

He's also written a book on investing in emerging markets and how the average punter can take advantage of what he says are exciting opportunities.

But there's really one big issue with all this. While Mobius cautions potential investors to do their homework and learn as much as they can about possible investment targets, the absolute reality is that the vast majority of people in developed countries who are interested in investing in emerging markets will only ever be able to do so by investing in a fund or other vehicles such as exchange-traded funds.

Hence, a lot of the advice Mobius gives about getting a feel for what's happening in a target country or reading as much information about a company, is going to be largely redundant for most small investors.

What they really need to be doing is researching the performance and ability of the fund manager they're considering giving their hard-earned cash to.

Despite this, though, Mobius's book -- even leaving aside its stated aim of how to make money from emerging markets -- offers useful glimpses at historic financial crises in nations such as Russia, Thailand and Mexico and why they happened.

It also provides good pointers on why investors should take a long-term investment approach and avoid panicking when things look grim.

If you're still satisfied with the reasons why you invested in a stock in the first place, don't succumb to the herd mentality to sell if it happens to suffer in a bear market. And buy when things look their worst. The value will eventually be outed by the market.

Mobius's book may not help you make your millions, but at least you'll get a good read.

Available with free P&P on www.kennys.ie or by calling 091 709350.

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