Tensions on the Korean Peninsula have been on the rise lately, as a new leader in North Korea seeks to assert his leadership by making increasingly provocative threats toward both its neighbors and the United States. In the following video, Fool markets analyst Mike Klesta talks with Fool contributor Dan Caplinger about whether U.S. investors should be worried about what's happening with North Korea.
Mike points out that the Dow Jones Industrials (DJINDICES:^DJI) have largely ignored the Korean threat. Dan believes that while most U.S. stocks have little exposure to the area, investors in South Korean stocks have already seen substantial losses and could continue to see further drops if the crisis escalates. Dan argues that for the most part, U.S. investors should look at U.S. companies that have business operations in South Korea to see how they plan to handle any rising tensions in the future. Moreover, investors in emerging-market ETFs need to be aware that they may have a portion of their assets invested in South Korea, although the exact amount varies among ETFs. Mike and Dan conclude that for now, the risk to the broader U.S. stock market is small, but the situation demands further attention.