Bulls Start to Sniff Around African Economy

June 17th, 2011

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(photo credit: ヘザー heza)

A company named Helios just unveiled its second big fund composed of equity investments in African securities. The entirely private-equity fund is the largest ever created in Africa, and it seems to show that investors are becoming more and more interested in the emerging markets there.

The idea behind investing in “emerging markets” is kind of the same as the idea behind buying low and selling high. Sure, there’s always the risk that a low-priced stock means it’s a bad company and you’ll lose money on your investment. But if the stock does well, you make money. Lots of money. Same deal with emerging markets.

Since investors are basically amateur fortune-tellers, constantly trying to predict how companies and markets will perform in the future, this new investment in Africa means that someone, somewhere, thinks that things are about to go really well in those emerging markets.

Stay tuned…

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