The Canadian markets have been underwhelming this year, underperforming pretty much every other index out there. While it can seem tempting to swap all your Canadian dollars for greenbacks (a better rate, finally!), it’s probably time to start thinking about beefing up your international exposure with an emphasis on red-hot emerging markets, which can deliver superior returns over the long term.
Do you ever wish you could unlock returns north of 9% per annum without speculating on micro-cap stocks trading on the TSX Venture exchange? I believe you could, on average, obtain next-level returns by investing in emerging markets without taking on an absurd amount of risk. What kind of emerging markets? India and Africa are just two. You probably don’t even know the names of their respective exchanges, let alone where to start!
Thanks to the Canada’s Warren Buffett, investing in such markets just got easier for Canadian investors with the Fairfax family of securities. You’re probably familiar with Fairfax Financial Holdings Ltd. (TSX: FFH) and Prem Watsa by now, but you probably didn’t know about his two other investment holding companies, Fairfax India Holdings Corp. (TSX: FIH.U) and Fairfax Africa Holdings Corp. (TSX:FAH.U).
Both of these stocks open doors to high-growth opportunities that can only be found in emerging markets. Prem Watsa is making deals that will unlock huge value for Canadian investors over the long term. You may not be able to name a single company based in India or Africa, but you won’t need to with Prem Watsa driving the bus down the profit road!
Fairfax India has returned a whopping ~69% over the past year, and Fairfax Africa has surged ~42% since its IPO, which was less than a year ago! These are incredible returns, and although it may seem like you missed out, there’s still a tonne of upside to be had over the long term.
Fairfax India has investments in various high-growth Indian businesses, and Fairfax Africa has just scratched the surface with its first investment in AFGRI — an agricultural company.
Bottom line
Both companies are excellent ways to gain exposure to hot international markets without the need of swapping currencies and opening a new brokerage account that’ll give you access to such foreign markets.
If you want next-level returns and you’re prepared to add some international flavour to your portfolio, then look no further than FIH.U and FAH.U. Both are incredible holding securities that will likely outperform over the long term.
Both securities have flown under the radar of most Canadians, especially when you consider the ridiculously low average trading volumes that both securities experience. I believe both securities deserve to be on the radar of every Canadian investor. The opportunity is unique and the upside is tremendous.
Stay smart. Stay hungry. Stay Foolish.
