Bring up “frontier markets” and most investors envision a potpourri of nations primarily located in Africa or the Middle East. Not so fast, my friend. A closer inspection of the growing number of frontier mutual funds and ETFs, for instance, shows that at least in regards to some of them, there is very little correlation to the aforementioned regions. Consider the Claymore/BNY Mellon Frontier Markets ETF (NYSEArca: FRN). The fund uses an indexing approach and seeks to more or less replicate, before fees and expenses, an equity index called The Bank of New York Mellon New Frontier DR Index. What does that mean? A close inspection of the fund’s holdings shows that Poland (25.07%), Chile (23.55%) and Egypt (14.78%) account for a majority of the top country weightings, and moreover that financials account for 41.61% of the sector weighting. Per Matthew McCall, ...

by Edward Hugh: Barcelona Yesterday, the Ukraine received a USD16.5bn loan from the IMF and the IMF at the same time said that it would agree with the Hungarian government on a rescue package in the coming days. Under normally circumstances this would be good news for CEE assets. However, it seems like the markets are totally giving up on CEE. This morning the Hungarian stock markets have dropped more than 10% despite the promise of an IMF package. ......it is worrying that the CEE markets continue to sell-off despite IMF’s clear commitment to support the region’s markets and economies. One might in fact see the lack of positive response to IMF’s rescue packages for Hungary and the Ukraine as an indication that these packages are in fact making the markets even more nervous that something “is seriously wrong in CEE”. Lars Christensen, Chief Analyst Danske Bank, CEE: Markets fail to respond ...