International Investing

Asian markets were slammed by North Korea’s nuclear detonation over the weekend. One of the hardest hit was its neighbor, South Korea, whose market took a 4% hit on the news. From the London attacks and Madrid bombing we’ve seen international equities markets prove very resilient to geo-political events. They recover quickly after a shock and there is no reason to think this time will be different. Especially so, since this was a test announced in advance by a leader whose specialty is tantrums. Basically nothing has changed:

“This is because the prospects of a nuclear test leading to economic sanctions severe enough to hasten a collapse of the North Korean regime, or worse, spark a full-scale military conflict, are still remote,” S&P analyst Takahira Ogawa wrote.

The easiest was for an investor to get access to this market is by using the iShares MSCI South Korea Index Fund ETF. If the market recovers like in the past, investors could see a quick gain with little downside risk.