The Singapore Story: Not a Sure Thing for Investors?

Lee Kuan Yew, the controversial founding father and former prime minister of Singapore, summed up his country’s history best when he entitled his memoirs, From Third World to First: The Singapore Story. However, there is more than one version of the Singapore story – something investors in the iShares MSCI Singapore Index Fund ETF (EWS), the iShares MSCI Singapore Small Cap Index Fund (EWSS) and The Singapore Fund (SGF), the primary investment options American investors have for investing in Singapore or in the Southeast Asian equities listed there, need to be aware of.

Investing in Singapore
The Marina Bay Sands in Singapore.

Among the other versions of the Singapore story is one that says the country was destined to succeed (at least in the past) simply because of its strategic location, deep water port and “one degree more” of efficiency in an otherwise “bad neighborhood” filled with mismanagement, corruption and political uncertainty. And then there is a recently written post (or rather a lengthy rant entitled i dun unerstan u lah!: An exposé of Singapore and Singaporean retardation) which has attracted wide attention online as it was written by an anonymous European working in Singapore and he or she goes into considerable detail to describe so-called “Singaporean retardation” or “stupidity.” Finally, Singaporeans themselves are growing increasingly restless over their country’s high cost of living, the presence of large numbers of foreign workers and corruption scandals – which could spell trouble for the long-ruling People’s Action Party (PAP) in the 2016 general elections with such changes impacting the iShares MSCI Singapore Index Fund ETF, the iShares MSCI Singapore Small Cap Index Fund and The Singapore Fund.

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Apocalypse Now For Investors? A Realistic Vietnam Investment Review

The Economist has entitled a story about Vietnam as “A tiger at bay,” but perhaps a more thorough Vietnam investment review would have led to the title “Apocalypse Now” – especially since the Market Vectors Vietnam ETF (VNM) is the only easy way for American investors to invest in the country right now and that ETF contains a few (unwanted) surprises for risk adverse investors. More adventurous investors could invest in VinaCapital (VCVOF.PK), which manages the following three closed-end funds: The VinaCapital Vietnam Opportunity Fund Limited (VOF), VinaLand Limited (VNL) and Vietnam Infrastructure Limited (VNI). However, those Vietnam closed-end funds trade on the AIM Market of the London Stock Exchange which largely places them out of reach for most American investors trading with discount brokerage accounts.

City Hall, Ho Chi Minh City
A thorough Vietnam investment review could have you concluding that the country is more than “A tiger at bay.”

So why could Vietnam be an “Apocalypse Now” for investors at this point in time? Let me first tell you about my experience living and working in Vietnam so that you can decide for yourself whether Vietnam is the best emerging market to invest in right now and then why Vietnam investments like the Market Vectors Vietnam ETF may not be your best emerging market ETF choice.

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Speculators And Hit-And-Runs: Investing in Indonesia

Indonesia is the world’s fourth most populous country, has the world’s largest Muslim population and is considered a good candidate to be added to the so-called list of BRIC countries; but when it comes to investing in Indonesia, American investors would be limited to telco stocks PT Indosat Tbk (IIT) and PT Telekomunikasi Indonesia (TLK) as both trade as ADRs on the NYSE; Indonesia ETFs like the iSHARES MSCI Indonesia Investable Market Index Fund (EIDO), the Market Vectors Indonesia Index ETF (IDX) and the Market Vectors Indonesia Small-Cap ETF (IDXJ); and closed-end fund Aberdeen Indonesia Fund Inc (IF).

Borobodur, Java, Indonesia
Investing in Indonesia, like traveling there, is not without risk.

While that might be a larger than normal selection for American investors compared with other emerging markets, its still fairly limited given Indonesia’s potential economic importance. However, is investing in Indonesia even worth considering and if so, what should you invest in?

Before we look at the options for investing in Indonesia, let me tell you about my recent three week trip to the Indonesian island of Sumatra and the Indonesian city of Medan – which probably has one of the fastest growing economies in the country.

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