Seeking diversification to expand your real estate portfolio? If your answer is a resounding yes, you can consider exploring frontier markets to invest in. So, what exactly are frontier markets? Frontier markets usually refers to countries that are smaller, less developed but with stronger economy than their emerging counterparts. Examples include Cambodia and Myanmar. Let’s look into some of the advantages of investing in frontier markets.
Many of the frontier countries are still relatively undiscovered and less crowded with global investors. These countries usually have many untapped resources such as young population and natural resources which allows for further development, thus, translating to potential capital gains.
Strong GDP growth
Many of the frontier countries have growing populations and strong GDPs as compared to developed and emerging countries. Countries with strong GDP growth will attract more investors, thus, increasing the potential rate of return on investments.
Huge potential for growth
Frontier markets may be riskier than developed or emerging markets, but these countries are typically politically sound and welcome foreign investments. With more foreign investments into the country, the economy of the country will grow and this allows for further development and infrastructure of the country. A country may be a frontier market today but will ultimately grow into an emerging market in time to come.
Investing in frontier markets offer vast investment opportunities as they are usually undiscovered and less crowded with investors. Investors seeking diversification should take advantage of the huge growth potential of frontier markets and invest in these markets before they become over-saturated with global investors.
Frontier markets is the way to go
Majority of the investors typically invest in developed and emerging markets as they are deemed “safer” and are of lesser risk as compared to frontier markets. However, risk and return are co-related. Frontier markets offer a myriad of investment opportunities and rewards for investors who are willing to accept the risk.
All information in this article is correct to the best of our knowledge and belief at the time at which the article was originally published.
This article was written in the author’s personal capacity. Any opinion expressed in this article are the author’s own and
do not reflect the view of Vivaz Capital Pte Ltd.
Vivaz Capital, a subsidiary of Vivaz Group Holdings Pte Ltd, is a private marketing and consultancy firm, headquartered in Singapore.
We market and bridge opportunities across Asia.