4 Countries For Foreign Investing (FXI, EWJ, EZJ, RSX, EWG)

Seeking a foreign addition to your investment portfolio? In this very interesting economic climate, there are opportunities to profit abroad. In addition to the potential for significant profits, investing internationally is a great way to diversify a portfolio, and serves to reduce total risk. Four countries are presented here and each one makes the list for very different reasons. 1. China - China has been a great country for foreign investment for many years; its economy has grown at a rapid pace for the last thirty years. Recent data suggest that China has surpassed Japan as the world's second largest economy. In August 2010, China's economy was worth $1.33 trillion compared to $1.28 trillion for Japan. According to experts cited in the article, China is projected to overtake the United States by 2030 as the world's largest economy. Investors may wish to consider iShares FTSE China 25 Index Fund FXI, an ETF that seeks to mimic performance of the FTSE China 25 Index by primarily investing in 25 of the largest and most liquid Chinese companies. 2. Japan - Even though China has surpassed Japan and is expected to overtake the United States as the number one world economic superpower, there are undoubtedly great opportunities in Japan. In the aftermath of the devastating 9.0 magnitude earthquake and tsunami, the Nikkei index fell, and it fell hard. It has since rebounded to a degree but not to pre-disaster levels. This potentially creates an attractive entry point for investors who wish to take a stake in Japan. Consider the iShares MSCI Japan Index Fund EWJ, an ETF that tracks the MSCI Japan Index. For a riskier investor, consider the ProShares Ultra MSCI Japan EZJ ETF, which seeks to return (or lose) double that of the MSCI Japan Index. 3. Russia - Russia is an interesting market to examine. It is unique because it produces more oil than Saudi Arabia, 12.3% compared to 12.0% in 2009, yet Saudi Arabia has long been considered oil powerhouse. The difference? Russia is not a part of OPEC. Russia is not bound by production quotas to which OPEC members must adhere. Due to this fact, Russia may gain increasing global importance as oil reliance sees no signs of ceasing in the near future despite environmentalist concerns that peak oil may be near. Investors can take advantage of this through the Market Vectors TR Russia ETF RSX. 37% of the composition of this ETF is concentrated in oil and gas companies. 4. Germany - Germany represents stability among the many countries in crisis in the euro zone; Germany has been integral to the bailouts in Greece and Ireland. As Portugal may be next to seek a bailout due to the veto of the latest economic austerity measures proposed, Germany may again be forced to foot much of the bill. There are specific risks to consider before investing in Germany. The euro zone collectively is highly intertwined and presents a systemic risk. Germany is owed $81 billion by Irish banks, so investors must realize that by bailing out Ireland, Germany was in effect, protecting themselves as well. Despite these risks, or perhaps because of them, it may be a great time to invest in Germany. The iShares MSCI Germany Index EWG is an ETF to consider. It has seen a 62% increase in share price in the last two years. Worried you missed the boat? Perhaps you did, but amidst the ongoing debt crisis, it may still have much room to grow once permanent and austere measures are enacted in the euro zone to strengthen the system and allow Germany to focus on its own growth.