Infrastructure Opportunities

With the market rising and falling everyday, now may be the time for investors to think about adding infrastructure investments to their portfolios. The sector’s low correlation with other assets can help diversify portfolios and increase returns while curbing risk. Cash flows from toll roads, pipelines and other infrastructure assets are also generally pegged to inflation. Infrastructure can act as a play on emerging markets, which need to build out, or developed markets which require improvements. For example, the Bureau of Transportation Statistics declared that nearly twenty-five percent of the 600,000 bridges in the United States are “structurally deficient” or “functionally obsolete”. Analysts believe that governments worldwide will need to spend $2 trillion a year through 2015 on infrastructure. Approximately, $35 trillion over the next 20 years. Investors wanting to add an infrastructure component to their portfolios can do so with several exchange traded funds in the sector. The iShares S&P Global Infrastructure Index IGF and SPDR FTSE/Macquarie Global Infrastructure 100 GII offer exposure broad based exposure to the theme. While EGS INDXX China Infrastructure CHXX and the PowerShares Emerging Markets Infrastructure PXR allow investors to play the emerging market build up.