- Thailand, Indonesia, Vietnam, and the continent of Africa are interesting.
- TIVA countries have a fascinating combination of great people and poor government.
- Investors can push for governance reform and do good while doing well.
TIVA (Thailand, Indonesia, Vietnam, and the continent of Africa) countries will be the next major multi-decade investment theme. This is not a short or medium-term market call. It represents a multi-decade bet that hard work, ingenuity, demographics, and rising living standards will spur massive consumer demand for products which will propel GDP, population growth, and GDP per capita in these nations to unprecedented heights. Personally, I would not mind buying heavily into TIVA countries after a market crash.
To paraphrase George W. Bush's character in Harold and Kumar Escape from Guantanamo Bay, "You don't have to trust your government to believe in your country." Nothing could be truer about the TIVA countries. Great people are saddled with poor government. And the ingenuity, hard work, and will to survive of the people will lead the way, combined with institutional investors pushing for good governance and human rights. There has never been a better chance for investors to do good while doing well.
Indeed, TIVA countries are in the investment sweet spot. They have large populations which provide a critical mass, and often are saddled with poor governance. However, their governments are not quite as monolithic and powerful as those of China, Russia, or India. Indeed, to put a fine point on it, they are large enough to deeply matter, small enough to be influenced, and intelligent enough to learn from the mistakes of China, Russia, and India. In a word, they are coachable.
Here is how investors can access TIVA markets:
THD (NYTHD) is my favorite Thailand ETF.
VNM (NYVNM) is not a perfect Vietnam ETF, but it will do.
AFK (NYAFK) is an interesting Africa ETF.
Given the behavior of markets, if the first world has heart burn, TIVA countries could get slammed. It is safest to buy these after a global market crash. And portfolio positioning should be kept to a size where revolution, currency, and debt crises do not wipe out the investor. In addition, investors should consider combining this macro positioning in TIVA countries with systematic trend following methods like the 50 SMA and 200 SMA crossovers to lower drawdowns and to keep risk under control.