Fisher Investments on Emerging Markets

Chapter 8. PUTTING IT TOGETHER

The preceding chapters provided knowledge necessary to confidently invest in emerging markets. But all that preparation means little if you don't know how to put it to use. Our last chapter focuses on practical concerns for investing in emerging markets, including the instruments available, different strategies, and the unique challenges in this corner of the investing universe. We then depart with a brief nod to the next frontier of emerging markets.

TWO INITIAL CONSIDERATIONS

Before detailing the tools, however, there are two important preliminary considerations: the type of investor you are and the strategy you intend to employ.

Institutional versus Retail

There are essentially two broad categories of investors—retail and institutional. Institutional investors are the big fish of the investment world. They wield hundreds of millions or billions of dollars and generally have a dedicated research staff and even trading desk to implement their portfolios. Their clients are huge foundations, endowments, and pension plans.

Retail investors, on the other hand, are the minnows of the investing universe. They have portfolios in the thousands of dollars up to a few million. They generally access their accounts online, place trades electronically or over the phone with a broker, and generally conduct their own research. Or they may hire a professional—usually one who specializes in working with other retail investors.

Most people are retail investors. But don't ...