Investors who profit the most do so by “getting in early and staying late” no matter what the asset class, and this is as true for emerging market stocks as it is for real estate and vintage automobiles.
A prime example is blue chip foreign companies such as Total SA (TOT, quote), China Mobile (CHL, quote) and Tata Motors (TTM, quote), which all offer gains from the need for increasing mobility that is a prominent feature of emerging markets as their economies evolve.
As millions of consumers in emerging markets become more affluent, mobility is becoming more than just a desire, it’s a need; and a necessity if economic progress is to be sustained. General Motors predicts that by 2030, the world’s 8 billion people will be operating more than 1 billion vehicles – and that by 2050, two-thirds of the world’s 9 billion people will be living in cities.
WIth more living in urban areas, there will be a premium on the service economy. For a service economy to function, mobility is the key: goods need to be transported to market, orders transmitted, and resources deployed to meet the need of the market. This can only happen when communications are facilitated and goods easily moved.
China Mobile and Tata Motors provide more effective communication and transportation in busy cities, and Total has the oil to power the vehicles. There are other reasons why each is a solid investment with a sound future, but the emerging middle class and its desire for greater mobility will be a profitable trend.