ETF Expert

It wasn't that long ago when pundits across the media landscape touted South Korea as one of the most attractive foreign markets. After all, you had Warren Buffett intrigued with steelmaker Posco.  And the bull market gains for iShares MSCI South Korea (EWY) over 6 years (October 2001-October 2007) approximated 500%!

Yet the 2008-2009 bear erased the bulk of buy-n-holder profits, many of whom hadn't discovered Korean stocks until 2004 or 2005. And by March of 2009, the 70% top-to-bottom nose-dive was epic.

Right now, though, many believe that things have brightened substantially for SK. Not only is iShares MSCI South Korea (EWY) up more than 25% YTD, but it has also managed to keep its "emerging market" status a little longer. Believe it or not, this gives the relatively mature market the opportunity to attract the "hotter" emerging market investor dollars.

Today, you also have Dr. Doom, Marc Faber, one of the more prominent bears on the Street, stating that South Korean stocks are the place to reinvest long-term. Mr. Faber stated that he didn't believe Korean stocks would revisit March lows. And he believes stock assets of the "East" will significantly outperform the "West."

Tom Lydon of ETF Trends noted that iShares South Korea (EWY) has an 18% weighting in Samsung, and that Samsung is on an expectations-exceeding path. Similarly, South Korea's 2% interest rates may have helped it dodge a full-blown recession.  The Bank of Korea has hinted at raising rates in Q4, which gives many the impression that the country is back on a growth track.

Finally, the charts seem to favor a South Korean renaissance. The 50-day moving average recently rose above the 200-day, and the current share price of EWY is above both trendlines.

If there's one, fairly sizable wrench in the spokes, it'd be the neighbors. North Korea's been firing off missiles with callous disregard and tensions have been escalating.

If you'd like to learn more about ETF investing… then tune into "In the Money With Gary Gordon." You can listen to the show "LIVE", via podcast or on your iPod.

Disclosure Statement: ETF Expert is a web log ("blog") that makes the world of ETFs easier to understand. Pacific Park Financial, Inc., a Registered Investment Adviser with the SEC, may hold positions in the ETFs, mutual funds and/or index funds mentioned above. Investors who are interested in money management services may visit the Pacific Park Financial, Inc. web site.