India has the world's second-largest population¹ and one of the best long-term economic growth rates of all emerging market countries.² India also has an educated workforce and seems to embrace all forms of technology-with, notably, about twice as many cell phone subscribers as there are people in the United States.

But with India being one of the so-called BRIC countries, we have to ask: Are investors potentially under-allocating? We believe they are.

Our Assets-Under-Management (AUM) Figures

We have reviewed all the listed ETFs in U.S. exchanges to determine ETFs focused on tracking the performance of equity market indexes specific to single emerging market countries. Throughout this piece, we'll reference AUM in the following format: ("EM Country" AUM) for clarity, and this represents the total assets in U.S. exchange-listed ETFs tracking equity indexes of that country (data source: Bloomberg, as of March 31, 2013). We also

By Tassos Stassopoulos

Evolving trends in emerging markets are not always driven by macro-economic policies or demographics. Sometimes, something as simple as a fridge can change millions of people’s lives and re-define an entire industry.

This is exactly what’s happening in India’s milk market. The world’s second most-populous nation is also the world’s largest market for milk, yet less than 20% of households own a fridge. The popularity of the white stuff in India, combined with the proliferation of refrigerators from a very low base, are perfect conditions for a milk boom, driven by the unique consumer situation in this market. These trends are not always easy to spot by doing desk research or just analyzing other markets. But based on our field research, we forecast huge changes for the dairy industry, suppliers and even economic efficiency, as new consumer trends in India accelerate.

Today, the Indian market for milk

By Laura Papi, Assistant Director, Asia and Pacific Department, IMF and Rahul Anand, Economist, Asia Pacific Department.

So far 2013 has been a breath of fresh air in terms of economic news: financial markets have rallied and economic indicators have started to surprise on the upside. In India, the rupee has strengthened and the Bombay Stock Exchange index (Sensex) crossed the 20,000 mark for the first time in two years. Industrial production has started picking up.

So is India’s growth about to go back to 8-9 percent? The short answer is no. But we need to look back to understand why India’s growth has decelerated to a decade low and why the slump, which has hit investment particularly hard, has persisted for over a year. As structural problems are at the root of the slowdown, so structural reforms must be at the core of the solution.

In the IMF’s

India's stock market and related exchange traded funds are garnering more attention as investors look at the country's rising middle class, relatively stable economic and political environment and cheaper rupee.

For instance, foreign institutional investments funneled $20 billion into India's markets over 2012, the second highest calendar year inflow since 1993, writes Nathaniel Matherson for The Motley Fool. Global quantitative easing measures helped push more money into the emerging markets, and with continued quantitative easing, institutional investments may not end anytime soon.

Investors who are interested in gaining access to India can take a look at a number of India related ETFs:

The EGShares India Infrastructure Fund (INXX) is an interesting play, as India is expected to spend $1 trillion in infrastructure projects over the next five years. INXX tries to reflect the performance of the Indxx India Infrastructure Index. Sub-sector allocations include industrials 36.3%, utilities 26.2%,

By: The ETF Professor

Despite a slack performance by the iShares MSCI Brazil Index Fund (EWZ), which is off almost 4.5 percent for the year, the four major country-specific ETFs tracking the BRIC nations have performed well as a group.

The other three ETFs are the iShares FTSE China 25 Index Fund (FXI), the WisdomTree India Earnings ETF (EPI) and the Market Vectors Russia ETF (RSX). Throw in EWZ and the average return for that quartet of BRIC ETFs is 9.1 percent. That is solid, but not awe-inspiring, particularly when the far less volatile SPDR S&P 500 (SPY) is up 13.4 percent.

The 2012 picture for BRIC ETFs is a bit prettier at the small-cap level. Using the Market Vectors Brazil Small-Cap ETF (BRF), the Market Vectors India Small-Cap ETF (SCIF), the Guggenheim China Small-Cap ETF (HAO) and the Market Vectors Russia

The careful selection of different Indian stock funds allows investors to enter the Indian market at a steep discount to US price multiples, even though the Indian market as a whole is trading at higher multiples than the S&P 500. Combining these low stock valuations with a cheap currency creates a bargain buying opportunity for value investors.

Why India?

India's cheap currency makes assets denominated in its currency cheap. Moreover, it scores better than Russia and China (The R and C in BRIC) for investor freedom. I will walk you through how I came to these conclusions.

To examine the investment prospects of different foreign markets, different markets were screened for discounts to Purchasing Power Parity (PPP) of their currencies versus the dollar. India currently has one of the cheapest currencies according to PPP, which is trading near a 60% discount to parity. From a top-down perspective, this is

Until a recent flurry of reform measures was announced by the Indian government, equities in India did not seem to be a particularly attractive investment.

Leaving aside recent developments, the Indian rupee was plunging, economic growth was collapsing, and corruption in the government sector made headlines every other day.

Of course, all of this has not changed overnight, nor it is supposed to happen that way. However, the anemic government has suddenly embarked on a reforms push in order to support growth, encourage investments, and prevent another fiscal and current account disaster for the country.

The reason for pressing the development button also has to do with the 2014 elections, which the current government might lose miserably if they don't do anything substantial over the next year and half. As an investor looking to generate superior returns for my portfolio, I would not investigate more deeply into the reasons for

Indian stocks have rallied recently, driven in part by improving economic conditions – and the fact that the government is beginning to relax some restrictions on foreign investors. In fact, in just one day this week, foreign investors bought more Indian equities than in the previous two months according to Bloomberg.

On February 6, we began advocating an underweight to India. Since that time, the MSCI India Index has fallen 4.3%, underperforming the broader emerging market index by 3.1% as of September 17^th. All of these developments – along with the following four reasons – explain why we are now upgrading our view on Indian equities to neutral from underweight.

1. The stock valuations have returned to a more reasonable level: the price-to-book multiple has fallen 6%, to 2.51 from 2.67.

2. On the cyclical growth front, India’s economic activity is holding up as shown in

India ETF products and the markets they track seemed to have a better week than expected. The major development within India occurred Thursday as the government announced the most recent GDP growth number. GDP growth came in at 5.3% for the fourth quarter (Jan - March) and was well below estimates. In fact, the growth number was the lowest since 2003. This caused markets to sell off. In addition, continued deterioration of the world economy on news from Europe, the U.S. and China also put pressure on valuations.

Yet with all this negative news, there were two India ETFs from iShares - SMIN and INDA - that finished the week positively. Many others only lost around 1% of their value. Here's the entire performance grid of all U.S. listed India ETF products via IndiaETFs.com:

(click to enlarge)

Four India ETF Funds Still Have YTD Gains

Indeed, despite the internal

By Daniela Pylypczak

Throughout the past couple of years, investors have witnessed just how far and how deep the eurozone's debt crisis has spread throughout the global financial market. As looming uncertainty and volatility continues to be a dominating force, many have flocked to their preferred "safe haven" investments, abandoning some of the more profitable and potentially lucrative corners of the market. And with many European countries on the verge of a double-dip recession, investors are seeing plenty of red flags warning them to stay away from riskier asset classes.

One segment of the market that has been particularly hit hard by the eurozone's debt crisis is emerging market equities. Developing countries tied to the plagued region are struggling to maintain adequate growth rates and financial stability. A look at the 4-week returns of our ETFdb Emerging Markets Equity category paints a rather grim picture, with no single

General Electric (GE) is a world-renowned and highly diversified machinery titan that offers a wealth of products and services in the technological and finance frontier. With a market cap of $201 billion, it boasts of an excess of 10 billion shares outstanding. Although its earnings per share don't rally the same dominance, I am still confident in General Electric's future.

Citigroup (C), a distant competitor, offers a more attractive earnings per share of $3.6, more than three times that of General Electric's $1.2. I will note that Citigroup and General Electric operate in two different industries, though some of their activities overlap. Although Siemens (SI) has a smaller market cap of $82.5 million, it shadows both General Electric and Citigroup with its earnings per share of $.8.77. Competitors like Phillips (PHG) and Smith Group (SMIN) trail behind with no hopes of getting back in the

By Daniela Pylypczak

The ETF industry continues to steam ahead with February showing high levels of activity on the product development front. After a busy January, this month also saw the debut of a number of first-to-market products as well as several long-anticipated funds from both large and small issuers, making the total count for new launches in February 37:

New ETFs

New exchange-traded products that began trading in February include:

• Global X launched their new Permanent ETF (PERM), which tracks the performance of four asset class categories that are designed to perform differently across different economic environments. The four asset classes are stocks, U.S. Treasury Bonds (Long-Term), U.S. Treasury Bonds (Short-Term), and gold and silver.

• iShares introduced two new foreign equity ETFs with the launch of their MSCI India Index Fund (INDA) and the MSCI All Country Asia ex Japan Small Cap Index Fund (AXJS). The India

(Click charts to enlarge)

The Indian NSE Nifty Index did fairly well in comparison until the end of February, falling just below the Hang Seng and DAX. The Nifty was the worst performer of the lot in 2011, falling 24% in a year when every index fell. The US S&P 500 (SPY) has lagged world indexes after a 2011 that was flat and in a relative sense, an outperformer.

One of the reasons often mentioned for the fantastic 2012 showing is that liquidity is plentiful with Europe's central bank accepting just about anything as collateral and providing unlimited funding.

Among BRIC countries, though, Russia has done extremely well, going up over 24%

India ETF products and the markets they track finished negative on the week as internal economic data showed India's growth rate slowing in the 4th quarter of 2011, worries over oil prices climbed and divestment of a state owned oil company was met with lukewarm results. The two largest India ETFs, Wisdomtree's EPI and PowerShares' PIN were down more than 2% for the week but still have gains of well over 20% for the year.

Indian GDP growth for the 4th quarter of 2011 was reported at 6.1%, considerably less than 3rd quarter of 2011's 6.9% rate. Although most investors were expecting a lower number based off the poor conditions in the last few months of 2011, the number came in a bit lower than expected. According to Bloomberg the consensus estimate for 2011 4th quarter GDP growth was 6.3%. A weaker rupee, inflation and high interest rates were

Across the board, 2011 was a very rough time for emerging markets around the world. Political crises, inflationary concerns and worries over exports sent a variety of markets tumbling. While India isn’t exactly an export powerhouse, the country is a huge market as the nation has over 1.2 billion people and an economy of almost $4.4 trillion (PPP). Obviously, with such a high population and a relatively low GDP, the average per capita income in the country is still pretty low, even taking into account the solid economic performance of India over the past decade or so. As a result, the nation has been thoroughly rocked by high inflation sending many securities spiraling downwards and levels of discontent screaming higher across the country.

In fact, India has been on a campaign of more than a dozen interest rates hikes in the past two year period in an attempt to

India ETF products have received over $200 million of net new inflows in 2012 and why not? The performance of unleveraged India ETFs is between 22% - 49% year to date. A single iShares' India ETF, INDY, has benefited the most gaining almost $110 million in new assets - more than the next two ETFs combined. It is interesting to note that the best performing India ETFs in 2012, SCIF and SCIN, have together only gained $8 million of interest. Here's the chart from Index Universe's Fund Flow Tool.

click to enlarge

Source: Index Universe

To put ETF flows into context, one must review the year to date performance chart of all India ETF and ETN products. This year, the best performers aren't necessarily the best asset gatherers. Just take

India ETF products had an outstanding week as Indian markets continued to rise on lower inflation data and the rising expectation of interest rates cuts. Unleveraged India ETFs gained between 4% - 8% for the week. Here's the weekly India ETF list displaying the performance of all India ETFs in the United States.

(Click charts to expand)

Source: IndiaETFs.com

India is now in bull market territory based off a 20% move from December lows on widely followed indices like the Sensex. In fact Bespoke Investment Group wrote an article last week, which included an informative graphic on Indian bull and bear markets since 2000. It specifically examined the Sensex and two variables: the average gain and length of previous bull runs. The article concluded the average bull market in India gained 111% and lasted 394 days. Clearly there could be considerable upside ahead for Indian markets if the historic

The 2012 rebound of Indian markets and the India ETF products tracking them have propelled the group to become a world leader in performance. Here's the global scorecard, courtesy of an informative chart component from Bespoke Investment Group. This chart displays country and selected regional performance through February 15, via ETF and ETN proxies. India is represented by the iPath MSCI Index ETN (INP).

(Click charts to expand)

India leads the pack in 2012 after lagging in 2011. Source: Bespoke Investment Group

INP is an interesting choice to represent India in the above chart as the largest and first India ETF is EPI from WisdomTree. EPI has returned 34% this year. Here's a list of all India ETF and ETN products ranked by performance year to date.

Non leveraged India ETF products have gained as much as 51% in 2012.

India is benefiting from lower inflation and the expectation

BlackRock (BLK) continues flooding the market with new ETF introductions this year. Following a dozen January introductions, the firm released 14 more in early February. All 26 provide international or global exposure, with many aimed squarely at competitive products. BlackRock also hopes its iShares brand will succeed where others have failed by rolling out funds that replace other firm’s closures.

The February launches include five global commodity producer funds, two India funds, two All Country Asia ETFs, and five targeting emerging market segments. Once again, BlackRock chose to divide the listings between the three major US exchanges: NYSE Arca, Nasdaq, and BATS.

The five new global commodity producer ETFs all have 0.39% expense ratios:

1. iShares MSCI Global Agriculture Producers Fund (VEGI) tracks a 168-stock market capitalization free float-adjusted index. Industry allocations include Fertilizer & Ag Chemicals 53%, Ag Products 23%, Machinery 15%, and Packaged

Indian markets took a bit of a break last week from their 2012 bull run. Most India ETF products were down for the week except for 2012's darling, India small cap stock ETFs, and the India consumer ETF (INCO). Here's a breakdown of the week's India ETF and ETN performance.

(Click to enlarge) Source: IndiaETFs.com

The Bounce

India ETFs are already up between 12% - 40% in 2012 and last week was a breather. Foreign investment has continued to pour into India with over $2 billion of inflows in January. In contrast, last January saw $1 billion of foreign outflows. India was the worst performing BRIC market in 2011 and was likely oversold by most investors, especially foreigners. At the time concerns over inflation, the rupee's devaluation and the overall risk Indian markets delivered in the midst of the EU debt crisis were valid but eventually proved overdone. Now India