Frontier markets

Frontier markets,

Definition of Frontier markets:

  1. Frontier markets are less advanced capital markets in the developing world. A frontier market is a country that is more established than the least developed countries (LDCs) but still less established than the emerging markets because it is too small, carries too much inherent risk, or is too illiquid to be considered an emerging market. Frontier markets are also known as "pre-emerging markets.".

  2. Capital markets located in developing countries that are less advanced. In countries were investable stock markets are not as established as those located in emerging markets. Frontier markets are considered risky but in some instances pay off can be high.

  3. The term “frontier markets” was coined in 1992 by Farida Khambata of the International Finance Corporation. While they are smaller, less accessible, and somewhat riskier than more established markets, frontier markets are still investable. They are considered desirable by investors looking for substantial long-term returns since these markets have the potential to grow much more stable and established over the course of decades. However, it is also possible for a more established, emerging market to regress to frontier market status, so investing in these markets is still risky.

How to use Frontier markets in a sentence?

  1. Frontier markets are less advanced than capital markets.
  2. Frontier markets are smaller and less accessible.
  3. Risks of frontier markets include poor liquidity and substandard financial reporting.

Meaning of Frontier markets & Frontier markets Definition