Ted Bauman’s Secret to Beating the S&P in 2018 — EM Investments

Ted Bauman has over 2 decades of international investment and financial industry experience. As a result, he’s got a keen eye for spotting foreign market opportunities that may elude investors with only domestic market knowledge.

One recent area where Bauman locked onto a major growth opportunity is in the sector known as emerging markets, EMs. In a success story that became somewhat legendary, Bauman, acting on an idea he had while watching a foreign country that had experienced years of economic mismanagement, followed by a critical power transition that resulted in a group of economic reformers now being in charge resulted in an investment opportunity, which Bauman seized on.

Following his analysis and instincts returned Bauman a 13 percent gain for a period when the S&P was growing at a meager 2 1/2 percent.

The transforming experience gave Bauman a strategy that has proven to be highly profitable. What he also discovered, to his chargin, was that there were very few investors who were taking advantage of these types of opportunities.

This was a somewhat costly oversight for those investors. Because, as he points out, following his EM strategy would have given them a 70 percent profit over what the S&P was providing to those same investors.

To this day, Ted Bauman continues to remain bullish on his position towards EMs.

The large domestic economic boom in 2017 saw S&P 500 giving 20 percent returns. However, for the same period, EMs still beat the S&P, realizing gains of 37 percent.

Noting that EM cycles typically last years, it’s not over yet, notes Bauman, who expects EM performance in 2018 to be very similar to 2017’s.

He also adds that weak dollar strength relative to foreign currencies gave those overseas fiats an advantage relative to the US dollar in their home markets.

Citing other factors responsible for the strong EM performance, Ted Bauman points out that EM earnings ratios were 12.5 times over their 12 month revenues. This factor, Bauman reveals, results in a 25 percent discount relative to their developed economic leader counterparts across the globe.

Strong earnings in EM markets, which were upwards of 13 percent, made them attractive for investment purposes as well.

Several factors point to the strength of EM returns this year including that the 10 to 12 percent forecasted domestic growth could coincide with even larger returns EM investments.

Ted Bauman is a graduate of the State University of New York and Georgia State University. Bauman is editor at Banyan Hill Publishing for the Plan B Club, Alpha Stock Alert and The Bauman Letter newsletters.

Read more about Ted Bauman: http://www.gold-eagle.com/authors/ted-bauman


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