Tag Archives: internet

Intel Never Had a Chance in Microsoft's New Flagship Phones

During its Windows 10 hardware event, Microsoft launched several new smartphones, including two flagship devices and one lower cost device. These phones, unsurprisingly, are powered by chips from wireless chip giant Qualcomm . That

Vietnam Steps Into Emerging Markets Spotlight

By Tim Maverick These days, when investors hear the words “emerging market,” they immediately run in the opposite direction. The Institute of International Finance reports that investors pulled $40 billion out of emerging markets in the third quarter alone. That’s the fastest pace since the height of the financial crisis and the largest outflow of funds since the fourth quarter of 2008. But as a contrarian investor, I’m intrigued. These outflows made me wonder if, in the panic for the exits, someone may have overlooked a gem. And sure enough, shining like a beacon in the dark, was Vietnam. According to researchers at Capital Economics, Vietnam is one of just five emerging nations, as well as the only nation in Asia, whose economy is growing above its average growth rate since 2010. Economists forecast that Vietnam’s $186-billion economy will grow at 6.1% this year and 6.2% in 2016. This follows growth of 5.2% in 2012, 5.3% in 2013, and 6% in 2014. Capital Flowing to Vietnam Vietnam has been able to attract productive capital inflows recently. In fact, it ranks seventh among all countries, including the United States and China, in foreign direct investment (FDI). Most of that money is going into manufacturing. Vietnam is highly competitive in low-tech industries like textiles and footwear. But importantly, it’s also competitive in high-tech manufacturing. Vietnam has become a major exporter of smartphones, for example, and Samsung has one of its largest global smartphone facilities there. Thanks to the Vietnamese government, the economy’s momentum should continue. The government lifted the 49% ownership cap at a number of listed companies, which will allow foreign companies to invest heavily – or even take over – some Vietnamese firms. In addition, the government has tamed inflation. In 1988, inflation was at an incredible 774%! Four years ago, it was still at 22%. Two years ago, it was down to only 6%. And today, inflation is negligible. Vietnam’s Emerging Consumer Class The growth of manufacturing jobs in Vietnam is changing the face of the country. Here are just a few examples: The country has one of Asia’s fastest urbanization rates, which is creating a consumer middle class. According to the CIA World Fact Book, about a third of the population is now urban. The annual urbanization rate from 2010-15 is just under 3%. Vietnam is now the fastest-growing auto market in Southeast Asia. Through August, year-on-year car sales were up a whopping 62%. Vietnam’s internet penetration rate is rising faster than anywhere else in the world. With more than 40 million people connected to the internet, Vietnam has more users than any other country in Southeast Asia. Not surprisingly, Vietnam has been Asia’s top performer in 2015. Its gain is only about 3.5%, but that looks fantastic compared to other stock markets: It’s still relatively cheap, too, at just 12.5 times estimated earnings. And what really caught my eye is that the market is still trading about 50% below the peak level hit in 2007. The only easy way for U.S. investors to play Vietnam is through an exchange-traded fund – the Market Vectors Vietnam Fund (NYSEARCA: VNM ). This ETF’s portfolio consists of 30 stocks, and it has about 75% of its assets invested directly into locally listed Vietnamese stocks. VNM has a very reasonable expense ratio of 0.7%. The big drawback is that VNM has underperformed Vietnam’s index, showing a year-to-date loss of about 19%. This is likely due to the fund’s over-weighting in the most liquid, financial stocks, as well as energy stocks. You can get much better performance with closed-end funds focused on Vietnam, which are traded in the over-the-counter market. The most liquid of these is the Vietnam Opportunity Fund ( OTCPK:VCVOF ). But even this one is very thinly traded. The advantage is that it’s trading 18% below its net asset value, so you’re buying assets at a discount in an already cheap market. Finally, when – not if – emerging market sentiment turns, the upside could be substantial. Original Post

5 ETFs Up At Least 10% This Year

Volatility has been calling shots in the investing world this year as hard landing fears in China, return of deflationary worries in the Euro zone despite easy policy measures, vulnerable emerging markets, slumping commodities and the nagging hearsay about the timeline of Fed lift-off dampened the risk-on trade sentiments on several occasions. Though the most part of the year saw decent trading, the global market went ballistic in Q3 on the Chinese market crash. Sudden currency devaluation, multi-year low manufacturing data and some failed but desperate policy measures to rein in the slide led the Chinese stocks to hit the dirt in Q3 and see the worst quarter since 2008. Needless to say, such a massacre in the world’s second-largest economy did not spare other risky asset classes. The most key global indices also endured the worst quarter in four years and the leading U.S. indices tasted correction in August. Also, emerging market fund flows are now likely to turn negative this year for the first time since 1988 (read: ETFs to Watch as Emerging Market Asset Outflow Doubles ). Agreed, a dovish September Fed meeting and a soft job report for that month finally pushed back the speculative timeline for the U.S. policy tightening to early next year. This also brought the risk-on sentiment back on the table. Yet it definitely does not ensure seamless trading till the end of the year. These may give enough reasons for investors to panic and look for equity survivors this year. For them, we highlight five ETFs that have gained over 15% so far this year. China – Market Vectors ChinaAMC SME-ChiNext ETF (NYSEARCA: CNXT ) After a lot of tantrums, the China stocks and ETFs finally seem back on track. Compelling valuation after a bloodbath, some decent factory data in September, continued momentum in China’s service sector, persistent rollout of accommodative government measures (though at a petite dose) and an accommodative Fed led this China A-Shares ETF to build up gains in the year-to-date frame. The Zacks Rank #3 (Hold) fund is up over 25% so far this year (as of October 5, 2015) and also added close to 20% in the last one month. However, the point to be noted here is that China investing stands at a critical juncture this year and the economy is far from being steady. So, A-Shares investing needs a strong stomach for risks (read: Correction Seems Over: Time for China ETFs? ). Long/Short – QuantShares U.S. Market Neutral Momentum Fund (NYSEARCA: MOM ) Since volatility has been at its height so far this year, this long/short ETF had to emerge as the winner. The underlying index of the fund is equal weighted, dollar neutral and sector neutral. The index takes the highest momentum stocks into account as long positions and the lowest momentum stocks as short positions. MOM is up 20.8% this year and gained 3.3% in the last one-month period. With volatility refusing to backtrack even in Q4 on global growth issues, MOM is likely to prevail ahead (read: 3 Hit and Flop Zones of Q3 and Their ETFs ). Japan – WisdomTree Japan Hedged Health Care ETF (NYSEARCA: DXJH ) Since the Japanese economy shrank 0.3% in the second quarter of 2015, marking the first contraction since the third quarter of 2014, and the third quarter output is also seemingly flat; hopes for further policy easing are doing rounds. The Japanese economy is already undergoing a gigantic stimulus measure. Thus, hopes for further easing amid a slowing economy gave the justified boost to this currency-hedged ETF. DXJH is up about 21% so far this year (as of October 5, 2015). However, the product was flat in the last one-month period. The fund has a Zacks ETF Rank #1 (Strong Buy). Denmark – i Shares MSCI Denmark Capped Investable Market Index ETF (BATS: EDEN ) The Danish economy expanded 0.2% in Q2 and carried on the longest stretch of incessant growth in 25 years. Moreover, the economy wiped out fears of a lull in Q2. All these stirred optimism around the nation. This Zacks ETF Rank #3 fund has added over 17% in the year-to-date frame and gained about 2% in the last one month. Internet – First Trust Dow Jones Internet ETF (NYSEARCA: FDN ) This branch of the U.S. technology sector has been a smart survivor in the recent global market sell-off. The usage of Internet has been gaining popularity. While its surge has saturated in the developed economies, scope for growth is huge in the emerging markets. Investors should also note that tech stocks normally perform better in the final quarter of the year. Thanks to this burgeoning trend, this Internet ETF has advanced 13.7% this year and added 4.7% in the last one month. The fund has a Zacks ETF Rank #2 (Buy). Link to the original post on Zacks.com