For those seeking fresh growth prospects, emerging market stocks are a worthy consideration. These stocks, representing companies operating in developing economies, offer the potential for rapid economic growth and an expanding middle class with increased discretionary income. Countries such as China, India, and Brazil, some of the most populous nations globally, are considered emerging markets.
Investing in emerging markets is an excellent strategy to diversify your portfolio. While U.S.-based stocks are crucial, a global perspective can provide growth opportunities when the U.S. market faces challenges. Diversification across various equities and stocks is your best defense against unexpected portfolio losses.
Let’s use the Portfolio Grader to examine some of the best emerging market stocks you can buy. These stocks, with their potential for higher returns and untapped market potential, are attractive choices.
Nu Holdings (NYSE:NU), a fintech company operating a banking and financial services platform in Brazil, Mexico, and Columbia, serves over 89 million customers. The company aims to capture the greater Latin American financial market, estimated to be worth $1 trillion. With its customer base growing from 70 million a year ago to its current 89.1 million, and customer balances increasing from $9.7 billion to $15.4 billion, the company is experiencing impressive growth. NU stock, up 104% this year, is ideal for investors seeking a robust finance stock in emerging markets.
Li Auto (NASDAQ:LI), a rapidly growing electric vehicle company in China, is my pick for the best EV stock in an emerging market. Despite not challenging Tesla (NASDAQ:TSLA) for supremacy, it seems to be making inroads into its larger competitor’s market share. Li’s revenue in the third quarter was $4.61 billion, a 271% increase from a year ago.
StoneCo (NASDAQ:STNE), another fintech company, serves small- and medium-sized businesses in Brazil. The company’s platform connects businesses to their customers through in-store platforms, online, and mobile channels. StoneCo stock is up 92% this year, including a massive 78% gain in the last three months.
Itau Unibanco Holding (NYSE:ITUB), another Brazilian fintech stock, provides retail banking, wholesale banking, commercial, and private financial services. It’s the second-largest bank in Latin America and has branches in Asia, Europe, and North America. Itau stock is up 48% this year.
EHang Holdings (NASDAQ:EH), a Chinese company that manufactures electric aircraft that take off and land vertically without a pilot, recently announced successful debut flight demonstrations of its EH216-S pilotless passenger-carrying aircraft. EH stock is up 101% in 2023.
D-Market Elektronik Hizmetler ve Ticaret (NASDAQ:HEPS), also known as Hepsiburada, is an e-commerce company operating in Turkey. The company has over 61 million members and over 101,000 merchants using the platform. HEPS stock is up 165% in 2023.
MakeMyTrip Limited (NASDAQ:MMYT), an online travel company operating in India, provides customers with everything they need to travel, including airline tickets, hotel reservations, rail and bus tickets, and travel packages in India and internationally. MMYT stock is up 70% in 2023.
Let us know what you think, please share your thoughts in the comments below.
