Emerging markets bonds. In terms of growth, many emerging markets nations like China and Brazil are expected to far outpace developed markets countries like the United States and the U.K. Many emerging countries also have their fiscal houses in order. "In a lot of metrics, relative to developed countries, they're essentially safer," Magoon says. Granted, their currencies are more volatile and the markets aren't as liquid, but measured from a debt-to-GDP perspective, the sovereign bonds of emerging countries look attractive. Investors have two options for investing in emerging markets sovereign debt: funds that invest in local currency, or funds that invest in bonds denominated in U.S. dollars. Investors can get exposure to local currencies through ETFs like WisdomTree Emerging Markets Local Debt (ELD). For investors that prefer dollar-denominated debt, Magoon suggests PowerShares Emerging Markets Sovereign Debt ETF (PCY) or iShares JPMorgan USD Emerging Markets Bond ETF (EMB).