What is the Emerging Markets Index?

    Published: 06-16-2009
    Views: 8,451
    Financial Advisor David John Marotta explains the Emerging Markets index.

    David John Marotta

    David John Marotta is the President of Marotta Wealth Management, a fee-only financial planning and asset management firm in Charlottesville, Virginia. He is an oft-quoted writer and speaker on financial matters and his weekly financial column can be found at www.eMarotta.com

    Host: What is the Emerging Markets index?

    David Marotta: The Emerging Markets Index is a collection of about 25 countries that are developing nations, they are not developed yet and because capital investments in these countries generally brings a higher rate of return because they need capital so much, they are considered a separate investment index. The Emerging Markets includes the BRIC countries Brazil, Russia, India and China, the largest in the emerging markets is South Korea and these are the countries that will have very high rates of return maybe 18 % a year but some years they will do huge negative as well. So, they very volatile. A little bit in Emerging Markets will boost you returns, a lot in Emerging Markets will make your portfolio very volatile.