"The Indonesian equity market ranked as one of the best-performing markets in the world through the first half of 2010," notes fund specialist Doug Fabian.The editor of The ETF Trader sees long-term potential in the Van Eck Market Vectors Indonesia ETF (IDX).
The advisor explains, "This fund has certainly has my attention. Even though IDX has been a solid performer so far this year, it appears to have more room to run.
"The ETF is intended to replicate, before fees and expenses, the price and yield performance of the Market Vectors Indonesia Index. The fund offers an easy way for you to ride the upward climb of the Indonesian market.
"In case you have doubts that faraway Indonesia is a place that you may want to invest, consider the following.
"Indonesia has a population of almost 248 million, ranking it as the fourth-most populous country in the world behind China, India and the United States.
"Among the world's top 20 economies in terms of GDP, Indonesia achieved 4%-plus economic growth in 2009 to become one of only a small number of major economies to grow during the "Great Recession."
"A big advantage that helped Indonesia during the downturn is the nation's vast natural resources, which let it benefit from the China-driven commodities boom and should boost Indonesia's economy going forward.
"The country also now appears to have political stability. That reduced political risk is no small accomplishment in a nation that previously had endured civil unrest.
"Indonesia's second-term President Susilo Bambang Yudhoyono, known better by his initials SBY, is a former army general who took office in 2003 and has led reforms that included trimming the government's debt as a percentage of GDP to about 30%.
"SBY also played a role in ending a civil war with renegade provinces and launching an anti-corruption drive that jailed politicians and central bank officials.
"His plan for Indonesia during the next five years includes increasing economic growth to 7% by 2014, cutting the poverty level to 8%, and slashing unemployment to 5%.
"In addition, the government plans to spend up to $34 billion to build roads, ports and power plants by 2017. Combined with projected private sector growth, Indonesia's $433-billion economy should almost double to $800 billion in the next five years.
"If global markets rebound during the second half of the year, IDX should be able to finish 2010 among the top-performing funds in the world."
Steven Halpern's TheStockAdvisors.com offers a free daily review of the favorite stock ideas of the nation's top financial newsletter advisors.
Reader Comments (Page 1 of 1)
11-16-2010 @ 11:50AM
David said...
I don't want to sound paranoid, but all those volcanos, earthquakes and tsunamis over there are not making Indonesia very attractive. I know they're doing marketing for companies to come and invest, but... what can you say about their frequency and propensity in being hit with natural disasters?
David
www.mutualfundsandetfs.com