A number of tax-exempt overseas stock funds are being put on the market one after another for investment in emerging markets such as China, India, Southeast Asia and Latin America as well as advanced economies like the United States, Europe and Japan with the sale of this type of funds scheduled to be resumed on February 29 after a hiatus of seven years.
These overseas investment funds are being regarded as a breakthrough with the Korea Composite Stock Price Index (KOSPI) moving sideways for years. Since the global financial crisis in 2008, the U.S. and European stock markets have gained about 100% to 200% whereas the Korean stock market has remained stuck. Experts are advising that investors make use of opportunities out of Korea as domestic investment conditions are being affected by the slowdown of the domestic economy and extremely low interest rates.
They also pointed out that investment in advance economies can be a wise choice for the time being as a rebound in corporate earnings, a recovery of economic growth and expansionary monetary policy are expected there. They mentioned the United States as the most promising option and it was followed by Europe and Japan.
On the contrary, emerging economies are said to be subject to debt risks with the United States looking to raise interest rates. “Investors would be well advised to be careful about investing in raw material exporting countries as the international oil prices are plummeting, but leading manufacturing countries such as China, Korea and Taiwan are expected to relatively safer,” said one of them.