It's hardly surprising that international stocks have gained popularity with investors over the past few years, since they've generated absolutely amazing growth.
For the sixth year in a row, the Vanguard Total International Stock Market Index (VGTSX) outpaced the Vanguard Total Stock Market Index, which tracks the broad U.S. market and includes top holdings in ExxonMobil (NYSE: XOM ) , General Electric (NYSE: GE ) , and AT&T (NYSE: T ) .
While foreign markets probably won't outperform the U.S. forever, international stocks are undeniably worth your time to research. And thanks to American Depositary Receipts (ADRs), U.S. investors have more opportunities than ever to trade foreign securities on domestic exchanges.
This month's best performances
While foreign companies participating in an ADR program must file reports in accordance with U.S. regulations and accounting standards, their different corporate cultures can make some of their business decisions seem unorthodox for American investors. To help us understand this month's top-performing ADRs, we've tapped the more than 81,000 investors participating in Motley Fool CAPS, the Fool's free investing community. Here are this past month's top ADRs.
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Company
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% Change
|
CAPS Rating (Out of 5)
|
|
DRDGOLD (:DROOY)
|
34.5%
|
**
|
|
AirMedia Group
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31%
|
**
|
|
Himax Technologies (NASDAQ:HIMX)
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30.3%
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*****
|
|
Randgold Resources (NASDAQ:GOLD)
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27.9%
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***
|
|
China Medical Technologies (NASDAQ:CMED)
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24.4%
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*****
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*Data provided by Capital IQ, a division of Standard & Poor's; screen excludes companies with below $100 million.
Remember, these stocks aren't formal recommendations, merely jumping-off points for further research. That said, researching five-star CAPS stocks such as these has proved to be an effective tool for investors.
Eureka!
With gold prices jumping from $795 per ounce in mid-December to a record high of $913 just a few days ago, it's easy to see how two of this month's top ADRs hail from the gold-mining industry: South African-based DRDGOLD and Channel Islands-based Randgold Resources.
Of the two, Randgold Resources gets more love from CAPS investors. Among the 166 players who've rated the stock, 145 think it will continue to outperform the S&P 500 going forward. Bullish opinions on gold, like the one below from saunafool last September, generally center on the dollar getting weaker (gold is priced in U.S. dollars): "Gold is at record high prices. There are many reasons for this, but the foremost is that the dollar is going down the tubes, because the Fed has been running the printing presses at full speed for quite some time."
Well-constructed bearish opinions on gold are hard to find on CAPS, with the possible exception of this one from bluestarlikes, who counters the weak-dollar argument for gold on the streetTRACKS Gold ETF board: "Present bullish arguments are [solely] based on a weaker U.S. currency outlook. However, the Dollar likely will reverse course and move higher during 2008 as falling energy prices into next year's November election (to allow the Republicans a chance at retaining some power at the federal level) and a slowing U.S. economy help the trade deficit situation and the inflation outlook in America."
What do you think about gold, gold stocks, ADRs, or any other stock, for that matter? Make your voice heard on Motley Fool CAPS. It's 100% free, so sign up today!
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