I stumbled upon a great quote from Godvig Capital fund manager Bjorn Englund, whose $22 million Babylon fund is the only notable foreign portfolio investor in the Iraqi bourse.

Englund, on the moral for investing in a downturn:

“The lesson is that you shouldn’t follow the herd.  You have to go somewhere where other people are not, where you have the first-mover advantage.”

As to Iraq in partiuclar, Englund mentioned that “there is very little foreign money in the market so it has not seen the sort of outflows you have had elsewhere.  The exchange has been immune to what has happened in the outside world.”

Both Iraq and Ghana, whose market I touted not too long ago and is up roughly 60 percent this year, will soon become electronically traded, which should deliver greater volatility and ease of access for foreign investors in the hope of facilitating long-term investment.  Ironically, however, the electronic switch could signal the end to the very isolation that has protected them in the first place and made them so attractive to frontiersmen.  “There are clear advantages to electronic trade,” points out Databank analyst Dorothy L. Ametefe from Accra, Ghana’s capital.  “But it will increase the vulnerability to external events.”