By Ben Levisohn
Back in Nov. 2011, I wrote about the new emerging-market acronyms that investment banks and asset managers had been manufacturing to sell emerging markets to investors.
We all know the BRICs–Brazil, Russia, India and China–but how familiar are you with the CARBS (Citigroup’s mix of commodity-producing nations Canada, Australia, Russia, Brazil and South Africa), MINTS (Malaysia, Indonesia, New Zealand, Thailand and Singapore), CIVETS (Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa), MIST (Mexico, Indonesia, South Korea and Turkey) and CASSH (Canada, Australia, Singapore, Switzerland and Hong Kong).
Some of these countries have done very well–Thailand and Turkey standout–while others have languished, including Brazil and Malaysia. But has any investors done better because of these acronyms? I seriously doubt it.
The acronyms keep coming, however. Turner Investments released a report on what they’ve dubbed the TIMPs. That would be Turkey, Indonesia, Mexico and the Philippines–and Turner says they “could be the next BRICs.”
The report notes that what made the BRICs so successful was the timing. It was coined in 2001 by Goldman Sachs’ Jim O’Neil, and for the next decade the group grew at a 6.6% clip–and investors gained 424% from 2001 through 2010.
The BRICs have been disappointing lately, so why not come up with a new, better group of countries that have nothing in common other than the potential for quick growth? And so we have the TIMPs. Turkey and Mexico are here because their locations should boost trade–and their economies. Indonesia is described as “a sleeping giant…and stirring.” And the Philippines, well, it’s “ready to meet the mostly unfulfilled expectations many have held for it” economically.
The only thing I can see that they have in common is strong performance. The iShares MSCI Mexico Capped Investable Market ETF (EWW) has 19% during the past 12 months, the iShares MSCI Turkey Investable Market Index (TUR) has gained 36%, the iShares MSCI Indonesia Investable Market Index ETF (EIDO) has returned 16% and the iShares MSCI Philippines Investable Market Index ETF (EPHE) has gained 35%. For those keeping track at home, the iShares Emerging Markets Index ETF (EEM) has lost 0.3% during the same period.
Those are fantastic returns, but how long can they keep it up?