International Investments – Asian Diversification and Cross Training


* International Investments – Diversify in Asian Markets

* Ecuador Real Estate – Diversify in Asian Markets

* Natural Health Tip – Diversify in Asian Kempo and More

International investments make more sense with the US dollar under pressure. When it comes to investing globally there are two markets, just for their sheer size and potential, that should not be missed, China and India.

These are the two economies of greatest growth potential but neither is without problems. First, one of the very things that makes them attractive also gives some concern. The attractiveness is that their currencies are likely to appreciate versus the US dollar. However if the dollar falls versus their currencies, one of their major buyers (the US) will stop buying as much as prices in dollar terms for Indian and Chinese goods will fall.

Indian and Chinese accounts and balance sheets are also a bit mysterious, more questionable than major market accounting which we know from the Enron and other such scandals is questionable enough. We must expect some scandals.

These countries are flush with money and have strong foreign reserves so there are not a lot of yuan or rupee debt investments. This leaves Chinese and Indian equities as the most logical choice.

China has better fundamentals of the two.

China has a trade and current account surplus. The Indian stock market is especially known for its volatility. India has a trade and current account deficit.

Keppler Asset Management rates China as a good value buy market, India a low value sell. Here are the numbers from Keppler’s analysis.

Country Price to Book Value Price to Cash Flow Price to Earnings Dividend Yield Return on Equity
China 2.05 6.9 12.2 2.66 16.8
India 4.39 15.2 20.2 1.25 21.8

Because of these complexities, mutual funds and Singapore companies that invest in China may be a better alternative than to invest in Chinese shares themselves.

China and India investments can also be blended with investments in Japan. This has worked pretty well this year. The Asian portfolio which our Borrow Low- Deposit High service began tracking October 21, 2005 is up 56% in seven months.

This portfolio started with four investments, $75,000 each in Jyske Invest Indian Fund, Chinese fund, Japanese Equity Fund and Emerging Bonds Fund.

The funds now are worth: JI Emerging Bonds up from $75,000 to $77,416.36.

JI Japanese Equities Up from $75,000 to $88,453.91.

JI Indian up from $75,999 to $94,254.

JI Chinese up from $75,000 to $102,591.58.

These returns are after the blood bath, we have seen in emerging markets this last month.

Not bad you might say, “a portfolio rising at a rate 56% (96% per annum rate) during one of the worst periods for such markets this decade is pretty good”. However the volatility is there. This portfolio was up 105% (180% rate) just weeks ago.

This dynamic up and down movement tells us three things. First, Asia offers excellent potential. Second, diversification within Asia is good for most investors but do not risk everything on just one country or share. Third, this is a long term play that will have its ups and downs. Either make your bet there and leave it alone for the long term or ride your Asian portfolio with careful stop losses.

You can learn more about the Jyske Asian funds from Thomas Fischer at fischer@jyskebank.dk

Enhance great profit potential with a diversified portfolio of Asian currencies through a MultiCurrency Sandwich. Learn how at garyascott.com/catalog/bldh.html

Learn about investing in emerging currencies, gold, silver, Ecuador, import-export, overseas markets and more. Join Merri, me and Thomas Fischer at our September 15-16-17, 2006 International Business and Investing Made EZ course in North Carolina. Review where to invest and do business now and learn which markets and currencies may be strong in the year ahead. Our May course was overbooked and the September session is already filling up fast. Our free accommodations are reserved on a first come first served basis so do not delay! Go to garyascott.com/catalog/ibeznc.html

Natural Health Tip – Diversify in Asian Kempo and More

Financial benefits are not the only thing coming out of the East. Nor is diversification just for wealth. Spreading out in health issues is called cross training. Cross training Chinese and Indian knowledge can help us support our livers. Our livers are under attack from all types of toxicities, pesticides to preservatives, that human bodies never had to cope with until this generation. The liver is such a vital organ that it is wise to take digestive enzymes and nutrients that nourish it.

This is why Merri and I use the first blend that uses ancient healing sciences from China and India to help the liver. We not selling or profiting from this product…which is what I want to add up front. We just use it, Dr. Burgstiner’s Liver C/S Plus sold by Preventive Therapeutics, Inc.

This is the first formulation combined from the ancient knowledge of traditional Chinese and Ayurvedic liver herbs. This is a synergistic blend of herbs and nutrients designed to cleanse and support the liver and encourage regeneration of liver tissue. This formula contains Alpha Lipoic Acid, Phosphatidyl Choline, Inositol, Milk thistle Seed, Tumeric, Dandelion, Artichoke, Schizandra, Bluperum, Organic liver extract, Andrographis Paniculata, Picorhiza Kurroa, Phyllantrus Amrus and Bioperine Black Pepper fruit extract.

We are also told by the people at Preventive Therapeitics, Inc. that many users of Liver C/S Plus who have hepatitis problems are doing well and when they take this formula.

There is more on this subject of the liver from Japan as well! A July 2003 daily message at our site said, “We saw yesterday that the wellness industry is growing in two sectors. These sectors are the natural and scientific. In the scientific field, some of the fast growing sectors are cosmetic plastic surgery, cosmetic dermatology (such as botox) voluntary eye surgery, (such as lasik, etc.), genetic engineering (sex selection and fertility enhancement), cosmetic and reconstructive dentistry, and voluntary pharmaceuticals (Viagra, Rogaine) etc.

“The natural industry (which is the place where Merri and I fit) includes health care and nutritional education, food supplements, vitamins and minerals, preventative medicine, wellness insurance, fitness clubs, trainers, coaches, fitness equipment, health foods, health food restaurants and weight loss products.

Often the proponents of these two sectors are at odds (we are of course are on the natural side), but each sector is huge and growing and already represents 200 billion a year in sales (half the sale of automobiles).”

Now the natural side is growing so fast that the scientific side is getting involved.

Take for example Sho saiko-to, a Japanese liver support. An article in Natural Standard says, “Sho saiko-to, a Japanese herbal formula that is a part of the East Asian Chinese medicine tradition, called Kampo. A Kampo drug is a standardized and regulated multi-herb formula. Kampo formulas are an essential component of Japanese integrative medicine and are often given to patients alongside Western treatments in even the most mainstream of Japan’s hospitals.

“Researchers at Memorial Sloan-Kettering Cancer Center in New York are conducting a clinical phase II trial to determine whether sho-saiko-to (SST) can help treat Hepatitis C (HCV). An estimated five million Americans have been infected with HCV, according to new research presented at the American Association for the Study of Liver Diseases Conference in November 2005.

“Most of the patients in the clinical trial have a genotype 1 infection, which is less responsive to conventional treatment than the other five genotypes. Of the 31 patients in the study, 15 have already completed the daily regimen of 7.5g of sho-saiko-to granules (4.2g of standardized herbal extract) for 52 weeks. Researchers reported the preliminary results of the 15 patients at the second Society of Integrative Oncology Conference in San Diego last November.

“So far the study, titled ‘Sho-saiko-to for Patients with Chronic Hepatitis C Who Are Intolerant to or Have Contraindication to Interferon-Based Therapy: A Phase II Study,’ has shown promising results.

“Among the 15 patients who completed the study, 11 patients showed reductions in alanine aminotransferase (ALT) and 10 patients showed reductions in aspartate aminotransferase (AST). Patients with hepatitis typically have high levels of both enzymes. No serious side effects have been attributed to sho-saiko-to among any patients enrolled in the trial.

“The results are consistent with previous Japanese clinical trials, which found that SST has anti- inflammatory effects. In animal studies, SST has demonstrated anti-fibrotic effects by inhibition of lipid peroxidation in liver cells and stellate cells. It has also been shown to reduce the incidence of liver cancer in patients with hepatitis and liver cirrhosis.” You can read the entire article at www.naturalstandard.com.

Ecuador Real Estate – Diversify in the Sun

While a rising yuan and rupee will hamper Asian trade, a falling US dollar will help business in Ecuador.

Currency moves can help or hurt a business. One reader shared this point when he commented on our recent message about investing in the Icelandic kroner.

“This was very good Gary. I once had a client pay $50,000 Canadian for a house in Iceland. Several year later he was ecstatic because it had increased 20x’s in value. However, the Kroner was now worth 1/20th of its previous value and if he sold, he would get $49,000 Canadian. He figured out a great wrinkle though. He sold the house and left the money in ICELAND. Then he sold his friends tickets on Air Iceland and eventually realized some $250,000 Canadian. IATA closed down whatever he was doing and it can’t be done now – This was in early eighties.”

This true story reminds us to look for contrasts and distortions in business WHEREVER WE GO. This is why Merri and I we will be joined by Thomas Fischer and our man in Ecuador, Steve, at our September International Investments and Business Course this September. Steve will speak at the course about contrasts that create real estate and export opportunity there.

Learn about Ecuador, import-export, overseas markets and more. Join Merri, Thomas Fischer, Steve and me at our September 15-16-17, 2006 International Business and Investing Made EZ course in North Carolina. Review where to invest and do business now and learn which markets and currencies may be strong in the year ahead. Our May course was overbooked and the September session is already filling up fast. Our free accommodations are reserved on a first come first served basis so do not delay! DETAILS

Until next message, good diversification in your investing and business!

Gary

P.S. Steve is also teaching the Spanish Portion of our upcoming Super Thinking – Super Spanish course. Here he is teaching our staff at El Meson de las Flores.

Join us for our Super Thinking – Super Spanish course. Enjoy Ecuador and the sun! See real estate for sale. Inspect the great markets as you learn to speak Spanish. For details go to garyascott.com/catalog/superspanish.html

 


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