The 5 Best Places to Invest

By Tim Hanson May 17, 2008

3 Recommendations

If pressed, could you tell me the country that offered the best stock returns over the trailing 12-month period? What about any members of the top 5?

It's harder than you probably think, because they're not the countries you might expect.

You call that a bull market?Despite recent volatility, the S&P 500 has still returned more than 10% annually over the past five years. While that's an impressive number on the surface, it's abysmal when compared to the rest of the world's equities.

And over the past year, the S&P has been down, while many foreign markets have been booming. Without further ado, the top performers over the past year:

Country

Return

Bangladesh

126%

Cote d'Ivoire

118%

Oman

99%

Mauritius

81%

Qatar

76%

Source: Motley Fool Global Gains.

This list is incredible to me. Tiny Mauritius?

We can learn a few things from this list. First, if you're an American investor, it's absolutely crucial to be invested abroad. The potential returns to be had there are too good to pass up. Second, the best returns often come from obscure places -- not from the countries we read about every day in the papers. And finally, there is some risk involved in investing internationally. For example, Bangladesh isn't exactly a nation known for its corporate governance, and Qatar is in a region not generally known for its stability.