Emerging Markets As A Store of Wealth

Where do you keep your hard earned cash, your emergency money that will be there in hard times? Some will keep it in a bank. Those trusted institutions with over 100 years of history and big vaults. But many have changed their minds on that since the Financial crisis. Some will answer that they keep it in Gold. Praised for a lot longer than banks, Gold has had a mesmerizing quality to it. But a store of value has not been one that has been proven over the last 5 years. More recently many would respond with Bitcoin. Well, last year at least, before it fell more than 60%. But how many would say Emerging Markets stocks?

Not many I am sure. But look at what has happened to the Emerging Markets ETF since the US market correction began in January. The chart below shows that it did suffer an initial pullback with the broad market, touching support and down about 13%. But since that initial drop it has been very stable. A bounce off of support and it has held in a range between 47 and 50 ever since.

Holding over the long term resistance level that has now become support, the Emerging Markets ETF has become the new trusted place to store value. And better, it has some positive indications for a upside when the dust settles and markets are no longer in turmoil. Momentum is diverging higher in the short term. Time to consider a new store of wealth.

The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.