Frontier Markets

Frontier markets are investment opportunities in countries that are, like, kind of developed, but not, like, developed developed, know what we’re saying? No? Okay, let’s try this another way.

In the global marketplace, we’ve got three main categories of countries: developed, emerging, and frontier. Developed nations basically have their financial act together: they’ve got regulatory laws, governing bodies, functioning markets, lots of liquidity, and a decently high per capita income. The U.S., Canada, and Japan are all examples of developed nations. Emerging nations are one tier below that in terms of financial stability and maturity, but they’re getting there. Examples include Mexico, Chile, and South Korea.

And then there are frontier markets. These guys—and the list currently includes countries like Croatia, Vietnam, and Jamaica—are in the beginning stages of getting their financial development on. They might not have a stock market or strong financial regulations in place, and they might have some issues in terms of political stability and income and liquidity levels, but they’ve got potential. Investment opportunities in these markets usually include infrastructure and small-business funding, and they can be hecka risky, but they can also be hecka profitable.