Warren Buffett is fond of saying that when you buy shares of a company, you should do so as if the stock market will be closed for the next five years. Point being, if you like the long-term fundamentals of a business, then what it is trading for in the near term is irrelevant.

The other advantage to such an approach is that it would prevent you from selling your shares no matter what happens during that span. Five years ago, the global economy was in disarray after the coronavirus pandemic upended the economy and severely disrupted global supply chains.

Had you bought stock a year or two prior to that, you may have sold your shares and put your money in a savings account earning almost no interest. But had you been forced to hang onto it until now, you would most likely be sitting on a large gain.

Foreign Substance

That analogy does not just apply to individual businesses. I believe it is even more helpful when thinking about international investing. Outside of the United States, most regional stock markets go through long cycles of boom and bust.

For that reason, many investors eschew investing overseas. It is difficult to rationalize tying up investment capital in something that isn’t moving. Especially when the S&P 500 Index is seemingly growing by double-digits every year.

I believe now may be an opportune time to move some money into an international market that has not gotten much investor attention. During the past year, the iShares MSCA India ETF (CBOE: INDA) has appreciated less than 5 percent while the State Street SPDR S&P 500 ETF Trust (NYSE: SPY) is up more than 15 percent.

Making the Right Call

Until this week, Wall Street wasn’t showing much interest in India. The Trump administration’s fixation with Greenland during the World Economic Forum in Davos, Switzerland in January had all eyes on Europe.

But that all changed at the start of this week when India Prime Minister Narendra Modi had a long phone call with the White House. Afterwards, President Trump announced an agreement that would result in both countries lowering their reciprocal import tariffs on each other, provided India stops buying oil from Russia and purchases it from the USA (or Venezuela) instead.

Purportedly, there are additional side deals in the works encompassing agriculture, technology, and manufacturing. It remains to be seen if the two countries can finish the job, but if they do then India may suddenly find itself no longer sitting at the kiddie table by the time this Thanksgiving comes around.

Room for Growth

There is a lot of room for economic growth in India. It now has the largest population in the world, growing by nearly one percent last year while China’s population shrank.

Its median age of 29.2 is eleven years younger than China’s, and its fertility rate of 1.9 is nearly twice that of China. It has a relatively small middle-class population, which bodes well for consumer spending as more Indian families raise their standard of living.

In short, all the pieces are in place for a sustained economic boom India that could last decades. All it needs is something to get it started, which this week’s preliminary trade agreement may accomplish.

Buy the Bucket

I do not advise buying individual companies in India to capitalize on this opportunity. Its economy is a witch’s brew of capitalism, cronyism, and oligarchism rolled into one.

Instead, I suggest taking a “bucket approach” by owning the entire stock market via INDA. Its top holdings include that country’s dominant players in finance, technology, and manufacturing.

You can think of those businesses as India’s stock market equivalent of what the “Magnificent 7” tech stocks are to the United States. They are the engine that drives its economy, and this week they just got a huge boost from an unlikely source.