There could, for example, be possibilities in European stocks that are depressed in price or in stocks of the U.S. multinational companies most likely to gain from European misfortune.
The primary risk is that ongoing problems involving not only
"For investors who haven't had exposure to European stocks, it looks like we're entering a period of some nice buying opportunities," believes
The Vanguard European (VGK) exchange-traded fund that tracks 443 European stocks is down slightly this year following last year's 32 percent gain. Patient investors would be wise to watch closely for ongoing negative news that could push its value down a bit further and turn it into a true bargain, DeLegge said.
That ETF's mutual fund sibling is Vanguard European Stock Index (VEURX). Both funds include primarily large- and mid-cap companies in 16 developed European markets.
He'd look to the top 100 companies in the
With a stronger dollar and weaker euro, U.S. companies can seek European acquisition candidates or expand their European businesses, he said. U.S. companies haven't been aggressive in such overseas expansion, but a weakening euro could set the stage.
"Weakness and doubt in
Among multinational leaders he finds attractive,
The potential for broad-based world fallout from the European situation remains the big caveat.
"There could be an effect on world markets because they're still fragile right now and reacting to reports--both good and bad--so it wouldn't take much bad news to send them into a sharp decline," Fitzpatrick said. "Yet that's less likely because regulators and officials in
There is still investment value in
"The No. 1 risk that could send European investment reeling and prompt a global aftershock would be a major failure of a country such as
But he puts the likelihood of that worst-case possibility at about 20 percent, which isn't enough to squelch thoughts of future investment bargains.
"U.S. investors who are underweighted in stocks now have a good opportunity to rebalance their portfolios and increase stock exposure in rock-solid companies," he said. "In terms of
DeLegge considers putting money into single-country European ETFs too tricky for the time being and is confident that the smartest move is to play the overall region whenever fear pushes prices down further. Thus far, the fear has been focused more on currency and government debt issues, but not so much on the equity markets.
"The problem with the
The EU has learned that while there is strength in numbers, there can be weakness in numbers as well, he said. The biggest flaw is the EU's lack of one centralized Treasury, which causes unavoidable structural problems whenever trying to cope with an economic crisis, he concluded.
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Investing - Weakening European Stocks Offer Some Bargains for U.S. Investors
(c) 2010 Andrew Leckey