Apple Inc. (AAPL), The Boeing Company (BA)–Warning: No Portfolio Is Complete Without This Sector

With that growth backdrop in place, it’s time to focus on the value argument. Thanks to a robust two-year run, the S&P 500 is valued at 15 to 16 times projected 2013 earnings. The multiple on emerging markets: 11. Think about it: The slower-growing economy has a much higher value, and the faster growing regions of the world are much cheaper.

Still, it’s fair to wonder why investors aren’t seizing on this disconnect right now and loading up on foreign stocks. The simple explanation: There is still a great deal of global economic uncertainty. And in times of uncertainty, investors (both here and abroad) focus their energy on the U.S. economy, which has a long track record of resiliency.

When will this uncertainty end? Probably when emerging economies such as Brazil, China and others appear to return to a firmer and steadier growth path. That could come as soon as this year. Or it might not happen for another year or two. It doesn’t matter. It’s crucial to think about foreign investments as a long-term opportunity and not a short-term trade. It’s wise to have some of your portfolio assets in these markets for decades, not quarters.

Action to Take –> If you waited to invest in the economic expansions in Japan in the 1960s and ’70s and in South Korea in the 1980s and ’90s until they had matured, then you missed the boat. The key is to invest in emerging economies when they are still experiencing growing pains. If you’ve avoided the seemingly scarier emerging markets up until now, it’s time be bold and venture abroad.

This article was originally published at InvestingAnswers.com
The One Crucial Investment Your Portfolio Is Probably Missing

– David Sterman

The article Warning: No Portfolio Is Complete Without This Sector originally appeared on StreetAuthority and is written by David Sterman.

David Sterman does not personally hold positions in any securities mentioned in this article. StreetAuthority LLC does not hold positions in any securities mentioned in this article.