March 22, 2021 | By: Sound Choices

Key Terms for Global Investing

3 min read

Global investing is a catch-all phrase for investing in securities from around the world – but there is more to it than just that. Here are some of the different categories associated with global investing:

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Global

Invest anywhere in the world including your home country.

International

Invest anywhere in the world except your home country. In Canada, that means both Canada and the United States.

EAFE1

The 21 Developed Markets in Europe, Australasia and the Far East:

Australia Austria
Belgium Denmark
Finland  France
Germany Hong Kong
Ireland Israel
Italy Japan
Netherlands New Zealand
Norway Portugal
Singapore Spain
Sweden Switzerland

United Kingdom

Developed Markets (DM)2

The countries whose economies are characterized by the sustainability of economic development – Gross National Income per capita 25% above the World Bank high income threshold3 for three consecutive years.4 

Americas Europe & Middle East Pacific
Canada Austria Australia
United States Belgium Hong Kong
Denmark Japan
Finland New Zealand
France Singapore
Germany
Ireland
Israel
Italy
Netherlands
Norway
Portugal
Spain
Sweden
Switzerland
United Kingdom

Emerging Markets (EM)2

The income criteria mentioned above helps explain why Brazil, China and India are on the list of the 10 biggest economies, but are still considered “emerging” – the size of their populations translate into a relatively low per capita income.

 

Americas Europe & Middle East Asia
Argentina Czech Republic China
Brazil Egypt India
Chile Greece Indonesia
Colombia Hungary Korea
Mexico Kuwait Malaysia
Peru Poland Pakistan
Qatar Phillippines
Russia Taiwan
Saudia Arabia Thailand
South Africa
Turkey
United Arab Emirates

Frontier markets: the next “emerging” markets2

“Frontier” markets can be classified using a variety of criteria, but are generally countries with lower income levels than the emerging market counties and considered less developed based on their economic level and liquidity. In this frontier phase, globally recognized regulatory authorities and administrations are often still in early development, which potentially leads to lower levels of transparency, shareholder and corporate governance.

Europe & CIS Africa Middle East Asia
Croatia Kenya Bahrain Bangladesh
Estonia Mauritius Jordan Sri Lanka
Lithuania Morocco Lebanon Vietnam
Kazakhstan Nigeria Oman
Romania Tunisia
Serbia WAEMU6
Slovenia

To learn more about global investing, visit "AGF.com/global" and talk to your financial advisor.


1 Source: https://www.msci.com/developed-markets. DM countries of Australasia = Australia, New Zealand. DM countries of the Far East = Hong Kong, Japan and Singapore.

2 Source: https://www.msci.com/market-classification

3 High income threshold for 2019: GNI per capita of US$12,376. World Bank, Atlas method as quoted in MSCI Global Market Accessibility Review (June 2020)  www.msci.com/documents/1296102/1330218/MSCI_2020_Global_Market_Accessibility_Review_Report.pdf

4 MSCI Market Classification Framework. Source: MSCI Global Market Accessibility Review (June 2020)  www.msci.com/documents/1296102/1330218/MSCI_2020_Global_Market_Accessibility_Review_Report.pdf.

6 The West African Economic and Monetary Union (WAEMU) consists of the following countries: Benin, Burkina Faso, Ivory Coast, Guinea-Bissau, Mali, Niger, Senegal and Togo. Source: https://www.msci.com/market-classification.


The commentaries contained herein are provided as a general source of information and should not be considered personal investment or tax advice. Every effort has been made to ensure accuracy in these commentaries at the time of publication; however, accuracy cannot be guaranteed. Market conditions may change investment decisions arising from the use or reliance on the information contained here.

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