OK, you've heard all about China, India, and Brazil. But Botswana? Over the next decade, stocks of companies in the high-growth developing world should fare better than those of more mature markets. Their relative advantage may shrink a bit, since the better-known markets, such as China's, have already done so well.
The sector isn't cheap. Right now, "emerging markets have a p/e [price-to-earnings ratio] of around 15, roughly mirroring that of the US market," says John Chisholm, chief investment officer of Boston-based Acadian Asset Management. But even relatively modest outperformance "can make a big difference to investors over the long term."
Over time, opportunities in the so-called "frontier markets" – places like Botswana, Bangladesh, and Bulgaria – could help keep the sector sizzling. Today's frontier markets "are riskier than familiar emerging markets," notably China, India, and Brazil, Mr. Chisholm says. But they're often cheaper and "interesting for the long term."