How to Make More in 2010

Odds are you made a little money in the stock market this year. You may even be feeling pretty good about yourself.

After an awful 2008 and an even more awful start to 2009, the U.S. stock market rebounded in a big way, with our benchmark index rising nearly 20%. Even better, widely held stocks such as Microsoft (Nasdaq: MSFT  ) , Hewlett-Packard (NYSE: HPQ  ) , and eBay (Nasdaq: EBAY  ) were all up more than 40%.

That's all well and good, but I want you to ask yourself: Could you have done better?

The answer is ...
U.S. stocks had an undoubtedly good year, but we lagged the rest of the world by a wide margin.

Excluding the United States, global stocks rose nearly 40% in 2009, and some markets did even better than that. According to data from Dow Jones, China was up more than 116%, Indonesia 87%, Brazil 82%, and India 81%.

What's more, you could easily have put some of the magnitude of these returns in your portfolio by buying shares of companies that operate in these markets.

Country

Company

2009 Return

China

China Green Agriculture (NYSE: CGA  )

374%

Indonesia

Telkom Indonesia (NYSE: TLK  )

65%

Brazil

America Movil (NYSE: AMX  )

56%

India

HDFC Bank (NYSE: HDB  )

83%

All four of these foreign companies are easily purchased, U.S.-listed stocks, and all four were all active Motley Fool Global Gains recommendations when 2009 began. Together, they helped our portfolio of recommendations return more than 70% in 2009.

And that's how you could have done even better in 2009: By adding a little global exposure to your portfolio.

Don't miss out
If you don't have any global exposure in 2009, then you did miss out on a good year in emerging markets. That's the bad news.

The good news is that 2010 is shaping up to be another good year for emerging markets investors, and you'll do better in 2010 if you add global exposure to your portfolio today.

Goldman Sachs recently released data, reported in The Economist, that showed that "the biggest emerging markets -- Brazil, Russia, India and China -- have accounted for 45% of global growth" since 2007. This is an incredible trend, and one that Goldman, The Economist, and our team at Global Gains all expect to continue in 2010 and beyond.

That's because these emerging markets not only survived the recent economic downturn in better shape than U.S., but can point to significant advantages over the U.S. when it comes to spurring growth going forward. In Brazil and Indonesia, the advantage is an ample supply of important natural resources such as oil; in India, a young and vibrant workforce; in China, a high savings rate that can support consumer activity.

What's worth buying
Of course, smart investors like you want to know if there are still any cheap stocks out there following these significant stock market gains. Well, Templeton Asset Management chairman Mark Mobius wrote on his blog recently that he's still "finding opportunities in almost all emerging markets," and we've had no shortage of new ideas at Global Gains.

If you'd like to learn more about a few of our ideas, simply click here to join Global Gains free this month. You'll enjoy access to all of our premium research with no obligation to subscribe.

Tim Hanson is co-advisor of Motley Fool Global Gains. He owns shares of America Movil. China Green Agriculture, Telkom Indonesia, and America Movil are all active Global Gains recommendations. Microsoft is an Inside Value pick. EBay is a Stock Advisor selection. Telekom Indonesia is also an Income Investor choice. Motley Fool Options has recommended diagonal calls on Microsoft and bull spread calls on eBay. The Motley Fool owns shares of Telkom Indonesia. The Fool's disclosure policy had a pretty good year except for that one night last March ...


Read/Post Comments (8) | Recommend This Article (59)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On January 07, 2010, at 3:06 PM, catoismymotor wrote:

    CGA treated me very well in '09. I think it will be a good one to hold onto for the foreseeable future, thanks in part to the Chinese government extending their tax free status through 2015.

  • Report this Comment On January 07, 2010, at 5:51 PM, drkazmd65 wrote:

    I know the YGE I bought back in February at ~$3.75/share has done really well.

    Just wish I had about 10 times as much free cash at the time to buy even more. Come March '10 when the year+day kicks in,.. I'll have to decide whether to hold it, sell all, or part of it at >300% gain.

    BTW,... thanks to a 'Foolish' article I read back in Winter '09 for the idea about YGE,....

  • Report this Comment On January 07, 2010, at 6:07 PM, Linh27 wrote:

    I purchased CGA at around $3 then purchased more at $7. That was bold of me to purchase a lot more when it doubled but it turned out well.

    China has a lot of people to feed and CGA is right there to fill the gap.

    I agree with catoismymotor that CGA is a long term company to invest in.

  • Report this Comment On January 08, 2010, at 1:36 AM, jamezparker wrote:

    HI

    Great information and according to data from Dow Jones, China was up more than 116%, Indonesia 87%, Brazil 82%, and India 81%.

    http://www.bid66.com

  • Report this Comment On January 08, 2010, at 2:02 AM, ozzfan1317 wrote:

    China Isnt taxing its people? Am the only one who doesnt think tax free is a road to ruin? Add in the accounting standards there and If I want Asia in my portfolio I will look for Japanese Small Caps.

  • Report this Comment On January 08, 2010, at 7:15 AM, Fool wrote:

    well guys here is some good advice. vanguard funds and i did real good last year.precious metals,energy,and emerging markets combined with high yield corporate both funds and etf's equaled better than 50%. 2010 is going to be more of the same i believe.

  • Report this Comment On January 10, 2010, at 6:08 PM, RiverRover wrote:

    Ozzfan --

    The article didn't say China isn't taxing its people. It only said that CGA has tax exempt status till 2015.

    Mary Ellen

  • Report this Comment On May 05, 2010, at 3:10 AM, Mstinterestinman wrote:

    Ok thanks I misread appreciate the clarification even if Im a little late to respond..lol

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1079122, ~/Articles/ArticleHandler.aspx, 10/26/2014 3:30:08 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement