It's no secret that 2011 was brutal to many investors in the United States, though the market only dropped by about 3.8 percent. After an extremely volatile year, the American stock market emerged flat, with little change from 2010. Most American investors were comforted only by the thought that at least we're not Europe. Not every market in the world was dismal, though. In fact, some markets saw gains in the high double digits. Just because these markets shone in 2011 doesn't necessarily mean that they're your ticket to riches in 2012, though; investing in foreign markets is extremely risky and in some cases impossible unless you're willing to move.
Venezuela Caracas Stock Exchange: Up 80.8%
The Bolsa de Valores de Caracas seems to be the big winner of 2011, up by an astonishing 80.8 percent. Before you start packing up your things and learning Spanish, though, you might want to read about the politics behind Venezuela's apparent economic health. Led by president Hugo Chávez, Venezuela devalued their currency by 50 percent in 2011, leading the stock market to surge as Venezuelans rushed to spend savings that they feared would soon be worthless. The devaluing of the currency, of course, let to extremely rapid inflation. As a result, the price of everything, including stocks, shot for the sky.
Mongolian Stock Exchange: Up 32.6%
Mongolia's Khöröngiin Birj ended 2011 up by over 30 percent, despite being down by over 40 percent in September. This gain isn't as impressive as last year's, though, when the market ended the year up over 120 percent. It probably won't surprise you to learn that these huge swings can be largely credited to the Mongolian stock exchange's tiny size. The exchange is only open for ten hours per week and turnover for the entire exchange regularly fails to reach $50,000 in a single day. Technically, there are about 300 stocks listed on the exchange, but a typical day only sees about 25 of those being traded, and there hasn't been an IPO in over five years. That said, it doesn't take much capital to be considered a high roller in Mongolia's exchange, and the country is experiencing rapid economic growth thanks to its plentiful natural resources.
Panama General Index: Up 29.1%
Panama's Bolsa de Valores enjoyed a record year in 2011, thanks in part to a new free trade agreement with the United States and a number of huge, job generating projects such as the expansion of the Panama Canal and the construction of Central America's first subway system. Unlike Venezuela's growth, Panama's is the real deal and investors are flocking to Panama City, including many Venezuelans looking for economic stability. Panama City is being touted as a kind of mini-Dubai by real estate developers, who have been throwing up new office buildings at the speed of light. Unfortunately, international watchdog organizations rank Panama near the bottom of the list when it comes to government transparency, and the country is still considered to be a major haven for money laundering. Critics worry that Panama may be in the midst of a bubble, and many of those gleaming sky scrapers are sitting empty, just like in real Dubai.