WSJ: “Corruption Risks Abound For ‘Frontier Market’ Investors”

Foglamp’s work helping investors navigate the high-risk/high-reward universe of frontier markets is featured in this Dow Jones/Wall Street Journal online piece.  Our favorite passage:

Gregg Wolper, a senior fund analyst at Chicago-based Morningstar Inc. said “investors in frontier markets know that the regulations will be less stringent in some of them…That doesn’t mean companies can’t be successful in frontiers, and the stock markets in general could rise if conditions are favorable, but there are risks in frontier markets and corruption levels are one of them.”

Wolper said a way to “spread your risk pool around” is to invest in funds, rather than individual companies, in frontier markets, but he cautioned that because these markets are so small, one corruption scandal can still have a large impact.

“If there was a major corruption scandal in one company in a smaller market it could create a lack of confidence in that market for a while,” he said.

You can access the full article here.