Emerging Markets Surge: South Korea and Poland Deliver 30% Average Returns in the New Era

The global investment landscape is shifting. While the United States remains an attractive market with its deep pool of established companies and accessible trading infrastructure, investors who ignore international opportunities are leaving substantial returns on the table. Today’s emerging markets aren’t just growing faster than developed economies—they’re pioneering innovations that will shape the future. Two countries stand out: South Korea and Poland, each representing a unique investment thesis in this new era of opportunity.

Why Global Diversification Matters Now More Than Ever

For most investors, the U.S. market feels familiar and safe. The New York Stock Exchange and Nasdaq provide easy access to household names, while the variety of exchange-traded funds (ETFs) makes building a diversified portfolio straightforward. But consider this: nearly 54,000 publicly traded companies operate globally, and many aren’t easily accessible to American investors.

Direct international investing presents real obstacles. Language barriers, different tax codes, unfamiliar regulatory environments, and currency risks can turn a simple investment into a logistical nightmare. For companies that don’t list American depositary receipts (ADRs) or global depositary receipts (GDRs), establishing foreign brokerage accounts becomes necessary—a time-consuming process most retail investors avoid.

This is where ETFs become transformative. By holding a basket of stocks from a single country or region, these funds eliminate the friction from international investing. Over the past year, two country-focused ETFs have delivered exceptional results, with an average return of 30% across the three-year period. For investors seeking meaningful portfolio diversification, these funds warrant serious consideration.

South Korea: The Innovation Powerhouse

The South Korean success story reads like an economic textbook case. From the ruins of occupation and war, the nation has evolved into one of the world’s most dynamic economies. With just 51.6 million people, South Korea ranks as the 14th-largest economy globally—a remarkable achievement.

The country’s influence extends far beyond GDP figures. Korean brands have achieved global recognition: Samsung dominates chip manufacturing alongside electronics; Hyundai ranks third globally in automotive production; and LG Display remains a powerhouse in display technology. These aren’t obscure regional players—they’re international juggernauts competing at the highest levels.

The iShares MSCI South Korea ETF (ticker: EWY) captures this ecosystem perfectly. Holding Samsung, Hyundai, LG Display, and 87 additional top-tier Korean companies, this fund has delivered remarkable performance. Over three years, it’s averaged 23% in annual returns—more than double the S&P 500’s average. The 2025 calendar year saw explosive growth at 98%, and the fund is currently up 11% year-to-date. For investors seeking meaningful Asian market exposure, this fund provides direct access to some of the world’s most innovative companies.

Poland: Europe’s Emerging Juggernaut

Poland presents a different but equally compelling investment opportunity. Since breaking free from Soviet control in 1992, this Central European nation has posted one of the world’s most consistent growth records. In the three decades since independence, Poland has recorded negative GDP growth in only a single year: 2020, when it fell 2% while global GDP contracted nearly 3%. The year following, Poland’s economy expanded 7%—vastly outpacing Germany’s 3.9% growth.

What makes Poland remarkable isn’t just macroeconomic data; it’s the companies emerging from this dynamic environment. CD Projekt Red has become a household name in gaming worldwide, creating franchises that define entertainment for a generation. Allegro generates 1% of Poland’s entire GDP through e-commerce dominance. Orlen, the national energy leader, commands a $31.8 billion market capitalization. These enterprises represent modern, forward-thinking businesses competing on a global stage.

The iShares MSCI Poland ETF (ticker: EPOL) provides concentrated access to this growth story. The fund holds all three companies mentioned above plus 37 additional leading Polish businesses. Year-to-date performance stands at just under 3%, while 2025 delivered a 76% return—slightly trailing South Korea but still exceptional. However, the three-year average tells the more important story: 37% annual returns, nearly quadruple the S&P 500’s average performance.

The Cyberpunk Era: Where Innovation Meets Investment

What connects these two markets isn’t just their economic performance—it’s their forward-thinking ethos. CD Projekt Red’s creation of Cyberpunk represents more than entertainment; it symbolizes the modern, boundary-pushing mentality driving both countries’ economies. From Korean semiconductor innovation to Polish software development, these markets embody the future of technology and commerce. They’re not following established patterns; they’re defining new ones.

This innovation-first mindset translates directly to shareholder returns. When you invest in these markets, you’re not buying yesterday’s economy—you’re investing in tomorrow’s leaders. The combination of strong macroeconomic fundamentals and visionary companies creates a powerful formula for long-term appreciation.

Constructing Your Diversification Strategy

The data speaks clearly: these two funds have averaged 30% returns over three years. Based on 2025 performance alone, maintaining this growth trajectory seems entirely plausible. For investors currently overweighted in developed markets, allocating a portion of their portfolio to these funds offers meaningful diversification benefits while accessing some of the world’s most dynamic economies.

However, investors should conduct their own due diligence before committing capital. While The Motley Fool Stock Advisor recently highlighted stocks they believe will outperform significantly, the investment landscape constantly evolves. Past performance doesn’t guarantee future results, and market conditions change rapidly.

The message is simple: global diversification through quality ETFs opens doors that traditional single-country investing cannot. South Korea and Poland have proven they’re not anomalies—they’re sustainable growth stories backed by innovative companies and improving economic conditions. For the forward-thinking investor, these markets represent opportunity in the new era.