Are you a global investor looking for an ultra-high risk-reward option? Consider Iraq. The perils are well known – possible civil war at the top of the list – but the Baghdad main index is still up 32 percent over two years, outperforming its Middle East rivals. This year has started less well – drops are hardly a surprise for a fractious country in a volatile region – but this frontier market has many of the ingredients of success.
The two-year performance is remarkable, well above the 6 percent gain for the FTSE All World Middle East and Africa index. Within the region, only very peaceful Qatar has come close, returning 28 percent. Saudi Arabia’s index has risen 11 percent. Investors in Egypt, Kuwait, and the UAE lost money. And unlike some peers, Iraq’s bourse welcomes foreign investors and there are no capital controls.