5 Sectors to Avoid in 2010

#1 Emerging/Developing Markets

In the past, Wall Street has lumped China in with Brazil, Russia and India calling them the BRIC countries. But this is no longer a viable way to
look at these markets — they all stand alone.

Simplistic momentum investing has taken hold in emerging market ETFs that cover regions such as Latin America or countries like Poland. Yes, Poland
has its own ETF, the Market Vectors Poland (PLND). But there is too
much money riding too much momentum in markets that are too small with too few equities and too little profit opportunities compared to the downside
risk.

Even though the hottest money is still pouring into some truly exotic markets, Eastern Europe is a sucker’s play in 2010. Your broker may call to
tell you about ancient cultures, robust cities, etc., but the banking and financial systems of many Eastern European countries are in terrible shape
and, more than likely, this will drag their economies down in 2010.

Learn
why you shouldn’t write off another financial crisis just yet.

Trade: Buy put options on the SPDR S&P Emerging Europe (GUR).

Next: The Homebuilders