Emerging Markets Have Some Appeal For Contrarians

Contrarian investors typically look to make their money by betting against the wider market. That means thus far in 2016, investors with this kind of strategy are looking to the market's slide as an opportunity.

For those with an appetite for risk, the current climate suggests that emerging markets could be a good place to make some money in the long run.

Be Selective

In an interview with MarketWatch, Motley Food Asset Management Chief Investment Officer Bill Mann said he believes emerging markets represent a good trading opportunity for longer-term investors.

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With China still working to make its market more transparent, Mann said he is still cautious on investing in Chinese markets, but that emerging markets excluding China could be very lucrative. In fact, he pointed out that over the past three years, emerging markets excluding China have outperformed developed markets.

Where To Invest

The Motley Fool Epic Voyage Fund TMFEX is one place investors can look to gain exposure to emerging markets; the fund has been cautious about China and holds 90 percent of its assets outside of the United States.

For those looking to invest in a particular emerging economy, Barron's recommends Korea and Mexico. Mexico has benefited from an improving U.S. economy and has been relatively insulated from the economic instability in China, while Korea has benefitted from low commodity prices as an importer of oil.

Investors can use funds like iShares MSCI South Korea Index Fund (ETF) EWY or iShares MSCI Mexico Inv. Mt. Idx. (ETF) EWW in order to track those particular economies.

Another emerging market economy that has the potential to improve this year is India, where price inflation has declined and given the Reserve Bank of India a chance to lower rates and boost the economy.