Research proves that undervalued equity markets achieve higher future returns
over longer term investment horizons.
Studies show that investing in markets which have just been through a bear
market and their valuations are low is one of the best ways to grow your investment
capital.
In 2012 Ireland was one of the countries with lowest PE ratio and a couple
years later and 100% rise in the EIRL (Ireland ETF), it is now the second most
overvalued country.
Every year there are several markets that are bottoming and starting a new
bull market. The key is finding them and being prepared to lock up some of
your investment capital in these longer term investments.
On Wednesday I recorded my call with Kerry Lutz of the Financial Survivor
Network. We talked about a couple new bull markets that were starting and the
one which I like the most. Listen To Call: Click
Here
I believe the best way to be successful as an investor is to actively manage
your portfolio. And when I say actively manage it, I mean, you should be rotating
your money out of underperforming stocks, sectors, commodities, and index positions
and moving that money to fresh investments which more room to rise.
In a week or so I will be doing a detailed report on how many positions a
portfolio of various sizes should be holding. You will be surprised with what
this report is going to tell you.
In short, the less the trades you make and the fewer positions you hold in
your portfolio can make a dramatic impact on your portfolio volatility, time
commitment, stress levels and performance.
Diversification between a small selection of investments and strategies is
vital. This is not rocket science, anyone can do it and I will show you how.
Anyway, let's get back to undervalued markets...
You have to invest in markets and sectors that have just gone through a bear
market. By doing so you can look forward to years of upside growth.
Cheapest Markets, and Most Expensive Markets
This table shows the valuations of world markets with the most recent data
available.
Looking from an evaluation stand point and long term investing Russia, China
and Greece are the most undervalued. And if we take an average PE ratio of
the majority of counties of 20, then we can calculate a rough percent return
each country should provide in the coming years.
Keep in mind, these markets can still be volatile and if you are a short term
trader its best not to trade based off fundamentals and valuation. Hedge fund
robots and my automated investing system do
not and most US stock market participants do not either.
Charts of Undervalued Country ETF's
These charts just show a simple snap shot and their first upside target before
they run into some long term resistance.
Long Term County Specific Investing Conclusion:
In short, this report is simple and uses a logical strategy. Again, it is
critical to have a diversified portfolio with completely unrelated investments
(different countries) and also to use different investment strategies and time
frames to balance portfolio volatility.
I believe you should have long term holdings and short term holding using
both long and short positions. Short positions allow you to profit from a falling
market, and some of the biggest and fastest money can be made with this strategy
and is a vital strategy within my automated investing system.
Learn About My Investing Strategy Here: www.AlgoTrades.net
