December 3, 2010
Sovereign debt worries continue to sap investors’ confidence about the soundness of the European Union and the euro. Stock- and bond mutual funds dedicated to the continent have seen a growing exodus, as shareholders grapple with a recently inked bailout plan for Ireland, turmoil in Greece, and the uncomfortable sense that Portugal and Spain aren’t far behind.
"Ireland, Greece and Portugal are basically insolvent and we will probably find out in due course that while these countries are too big to fail, and Spain is too big to rescue — this saga is far from over," wrote David Rosenberg, chief economist and strategist at Toronto-based Gluskin Sheff Associates Inc., in a recent note to clients.
Conventional advice recommends holding European stocks in a diversified investment portfolio. But with growing unrest across the continent and doubts about the viability of the European Union, how do you invest in Europe at a time like this?
Carefully. Many of the region’s beaten-down stock markets offer potential value, but there’s also risk of buying in too early.
Yet some intrepid mutual-fund managers are finding selective opportunities in Greece and Portugal, along with more predictable Germany, Switzerland and Norway. Here are five surprising stocks on their radar:
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