In investment terms, emerging markets are those countries whose financial markets are less developed, and where investor protection and the overall market infrastructure is often weaker than in developed markets. For example, Eastern Europe includes Turkey and Russia, and further afield; Asian countries includes Malaysia and India. Some of these markets have been top performers and many people strongly believe emerging markets have strong economic growth potential thanks to a young and growing population, durable consumer spending and a prospering middle class.
This growing demand for goods and services in the emerging markets may be sustained as incomes continue to rise and people seek to take advantage of economic progress taking place in the developing world.
Some strategies target global consumer brands, rather than investing directly in emerging market companies, to derive the benefits as consumption rises rapidly across the emerging markets. There are strategies that cover a spread of countries, and also country-specific strategies. Both these strategies are considered as high risk so investment amounts should be minimal. Economies in these countries are often unstable which increases their risk rating. When a crisis hits a country, it can seriously affect strategies that invest heavily in that particular region. Larger investments into these markets is for the risk-willing investor only.