Mark Mobius recommends emerging market shares

"EM shares look" very cheap "now and are a very good opportunity to buy," says famous investor Mark Mobius to CNBC.

In recent months, investors have been unloading their shares from the EM markets because of fears of financial troubles originating from Turkey and Argentina, which can be shifted to other countries. In addition, a strong dollar and high oil prices are also factors that hurt economies in the sector, especially those with large external debt and those who import a lot of energy resources.

But for Mobius, this is an investment opportunity that is revealed on the horizon. Some emerging markets are already recovering in terms of their currency and their index values. This is due to the stabilization of the dollar, which reduces the weight of the foreign debt denominated in US dollars.

What to buy?

Latin America - Brazil - leading the recovery process. Asia lags behind, but the region still offers good opportunities. Medium sized companies in China are interesting and would be a good investment opportunity. Indonesia, Thailand and Malaysia are in good shape and also create good investment horizons.

Risks

Mobius's forecast is oil to reach $ 100 a barrel by the end of 2018, which will be bad news for emerging markets.

But it seems that this level will hardly be reached, but it is not excluded that in the long run oil will return to $ 100. The good news is that as it happens, the EM states' currencies will have recovered sufficiently against the US dollar so that rising oil prices will not hurt their economies so much. The other risk, of course, is the trade war between China and the United States.

Photo: Pixabay

Read more:

• Boeing 737 crashes in Iran as soon as it took off
• Iran with new threats, Trump repeals his statement from the Oval Office
• US bases in Iraq were hit by the Iranian national guard
• Rumors of an attack by Iran against a US base in Iraq
• The Phase I Deal signing ceremony will take place on January 15 in Washington