Heat and Hype: Will Brics Hit the Wall or Keep Smashing through It? ; the Returns Are Sizzling in Brazil, Russia, India and China. but Opinion Is Divided on Whether Growth Will Endure

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As the starting gun fired for 2006, "Brics" were the fastest thing out of the blocks in the race for investors' money.

Back in January, these new funds directing cash into Brazil, Russia, India and China were being talked about by independent financial advisers (IFAs) and fund managers as the investment for 2006.

Stock markets across the world were booming and these four giant, emerging economies - which between them account for 40 per cent of the world's population - were rising in wealth and influence.

Offering huge natural resources, such as gas and oil, cheap labour and a vast manufacturing capacity, as well as burgeoning consumer cultures, these countries seemed just the thing for investors looking to spice up their portfolios with a high-risk stake.

Big investment banks and fund managers including Goldman Sachs, Templeton and Schroders launched Bric funds to try to win new investors. Some went even further, with Axa stirring Korea into the mix to create a "Brick" fund.

Fast forward to the end of 2006, and it's difficult to dispute that this has been a lucrative year for Brics, especially when compared with results from mainstream investments and from Brics' nearest rival, "emerging market" funds, which tend to spread their resources across a broader range of countries and companies.

In the five months since its launch, the Templeton Bric fund has returned 10.6 per cent for investors, while Axa Talents Brick has risen by a third over the past 12 months.

The Allianz RCM Bric Stars fund, supported by a big marketing push, has also performed robustly: a [pound]1,000 investment at its launch in February would now be worth [pound]1,162 - an increase of 16.2 per cent.

Compare that performance to a mere 0.7 per cent return over the same period from the global emerging markets sector (calculated by the Investment Management Association). Even the star managers of this sector couldn't keep up with the Brics. The First State Global Emerging Markets fund has made 4 per cent between February and this month, while Aberdeen Emerging Markets has returned just 2.2 per cent.

Over this turbulent period - emerging markets were hit particularly hard by the global stock market wobbles in May - you would have been better off in a UK tracker fund: the FTSE All Share rose by 8.5 per cent.

The performance of the Allianz fund has impressed IFA Hargreaves Lansdown, at first sceptical about the sector, to the extent that it has been added to the adviser's "Wealth 150" list of recommended funds.

"This did require a lot of thought, since Bric is [really] a great marketing concept," says Meera Patel, senior analyst at Hargreaves Lansdown. "But in the year to date it has outperformed all the emerging market funds, which are more broadly based. It has not been as risky as we thought."

Other IFAs, though, say the funds are beginning to lose their gloss. …