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Health & Fitness

International Investing - Poland

The world is a big place – there are over 190 countries and 7 billion people in the world, which really boggles the mind if you sit down and think about it. In addition to being an interesting intellectual exercise, this fact can also have broad implications for your investments and your financial future. It is easy to stay focused on U.S. firms, news, and events during the day-to-day grind, but it is always important to be aware of your surroundings – especially when it comes to your investments. With that in mind, this series of articles will focus on countries and investment opportunities outside the United States that you might not usually hear about.

As always, be sure to consult a financial services professional familiar with both the potential investment and your unique financial situation before embarking on any investment program.

Poland

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A nation that has long straddled the divide between Western Europe and Eastern Europe, Poland has numerous attributes and features that might make it an attractive addition to an international investor’s portfolio. While much of Europe has struggled mightily with the European sovereign debt crisis, the Polish economy has managed to survive the debt crisis with much less damage than many other economies. The economy is the 6th largest in the E.U., and has historically been one of the fastest growing.

Several attributes that might make the Polish economy an attractive option to add to your portfolio include infrastructure, demographics, and location. Headed by an accommodative government that is pro-U.S., pro E.U., and pro-economic development, the regulatory structure, while not yet perfect, is vastly improved. Incentives and tax credits incentivize firms to invest in both infrastructure and business development, and access to the entire E.U. market provides Polish manufacturers and service firms with an enormous market. Partnerships with some of the largest oil & gas conglomerates, and a population nearing 80 million, round out some of the highlights with regards to economic attractiveness.

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When looking at investing in Poland, there are two primary ways to go about it – ADRs or direct purchases. An ADR is basically a certificate held by a U.S. banking institution that represents a certain number of shares in the foreign company and is held by the U.S. institution. This helps to cut down on the administrative fees and other costs that would otherwise be incurred. For more direct exposure, you can also purchase shares directly from Polish stock exchanges if your broker offers those services to its retail investor base (you and me).

Some of the most liquid and well-known investment options available via ADR are Asseco Poland (software & computing services), Bank Zachodni (banksing), Boryszew (Chemicals), BRE bank (financial services), and Echo Investment (real estate services). Two ETF options that are heavily weighted toward the Polish economy are the iShares MSCI Poland Capped ETF (EPOL), and the Market Vectors Poland ETF (PLND).

As always, I have attached some links with more information

Happy Reading!

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