When the global economy transitioned into "recovery mode" following the latest recession, the emerging markets of the world jumped into the lead and quickly left their developed counterparts in the dust. Although advanced economies have resumed expansion, growth rates in the U.S. and Western Europe lag far behind the impressive figures being put up by China, Brazil, and countless other emerging economies. 

Some investors have always embraced emerging markets as an opportunity to access high-growth areas of the economy, but in recent years interest has surged to new highs. With significant hurdles to growth in advanced economies -- including sky-high unemployment and mounting debt -- many investors are rethinking the traditional wisdom that has called for them to allocate huge chunks of portfolios to domestic securities. The "home country bias" isn't dead, but it's taken some body blows [see this Q&A With Richard Kang for more on this topic].

Most emerging markets ETFs are dominated by the BRIC economies -- Brazil, Russia, India, and China -- which are expected to account for an increasingly large portion of the global economy in the coming decades. Cash inflows into BRIC-heavy equity funds have been strong for many months now, as investors rebalance the equity portion of their portfolios to establish a heavier tilt toward high-growth emerging markets and away from the less-than-promising developed countries in Europe and North America.

Some investors are also now seeking out exposure to emerging markets currencies, viewing this asset class as an attractive way to capitalize on the growth gap between the world's advanced and developing economies. To many the idea of currency investing conjures up notions of highly levered, high-risk forex trading. In reality, currencies are a relatively low volatility asset class. Moreover, currency investing done through ETFs doesn't have to be a zero-sum game; some products capture returns associated with both exchange rate movements and money market returns available to foreign investors [see Top Performing Currency ETFs From The First Half Of The Year].

All four of the BRIC nations have rapidly growing economies, relatively sound balance sheets, and interest rates that are far higher than those available in the developed world. As non-correlated assets have become harder and harder to find -- equities and commodities now exhibit strong correlations -- currency ETFs have gained a new level of respect from investors seeking to more thoroughly diversify their portfolios. Below, we profile the four funds that offer direct exposure to the BRIC market through currencies. This option could make for an interesting choice for investors seeking exposure to the BRIC but are wary of equity investing in the short term because of the wild fluctuations of emerging market stocks [also read the Definitive Guide To BRIC ETFs].

WisdomTree Dreyfus Brazilian Real Fund (NYSE: BZF)
Like all of WisdomTree's currency products, BZF is an actively managed ETF that seeks to achieve returns reflective of both money market rates available to foreign investors and changes in value of the currency (the Brazilian Real in this case) relative to the U.S. dollar. The money market rate in Brazil is currently north of 10%, compared to near zero for the U.S. This ETF charges an expense ratio of 0.45%, and is up about 3% on the year [see more on BZF's fundamentals page].

CurrencyShares Russian Ruble Trust (XRU)
For investors seeking exposure to the Russian ruble, XRU may be one of the best options. XRU, which unlike WisdomTree products is structured as a currency grantor trust, charges an expense ratio of 0.40% [read more about the nuances of currency ETF structures]. The fund is at break-even thus far in 2010 and has produced a gain of 2.2% over the past 52 weeks.

WisdomTree Dreyfus Indian Rupee Fund (ICN)
ICN gives investors exposure to the Indian rupee and India's money market rates, which currently yield above 5%. The fund is up about 2.6% over the last year, but also charges an expense ratio of 0.45% [see more on ICN's fact sheet].

WisdomTree Dreyfus Chinese Yuan Fund (NYSE: CYB)
Perhaps no currency has drawn more interest from investors around the globe than the Chinese yuan. Some skepticism remains over the sincerity of Beijing's intentions to allow the Chinese currency to appreciate against the dollar, but most agree that the long-standing peg will ease in coming years [see Five Unlikely ETF Winners From Yuan Policy Shift].

In addition to CYB, the Market Vectors Chinese Renminbi/USD ETN (NYSE: CNY) also tracks the Chinese yuan against the dollar. However, it's worth noting that CYB has more than ten times the volume and assets under management [see more analysis of CYB on its technicals page].

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Disclosure: No positions at time of writing.

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