The U.S. stock market is making new highs and there is endless talk about China's economic growth and impending economic dominance. From a top-down perspective, investors should look elsewhere to regions that are not in the limelight.
On a risk-adjusted basis, Hong Kong, Singapore, and Taiwan were found to be attractively-priced. In contrast to the People's Republic of China, the currency pricing of these regions within Greater China are cheap after considering the country risk facing outside investors. Investors can capitalize on this by buying the iShares MSCI Hong Kong Small Cap ETF (EWHS) and the Taiwan Fund (TWN).
Finding the Most Value for the Least Country Risk
Different markets offer different risks and rewards to foreign investors. To evaluate the investment prospects of different foreign markets, different markets were screened for discounts to Purchasing Power Parity, PPP, of their currencies versus the dollar. To assess the risk of
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