Brazil, as part of the coined term BRIC, is an emerging economy with a very bright and promising future. Investments in Brazil have rewarded those with a solid investment strategy, though it has caught others flat-footed when it has gone through its periodic swoons. Mutual funds for Brazil thus remain the preferred methodology to invest in that country (or for that matter, for any emerging economy).

Brazil, unlike other emerging economies of China and India, has often flattered, only to deceive. It has had its periods of tremendous growth, but punctuated by periods of high inflation and poor economic policies which strangle growth. The stock and bond markets would then react poorly and the unaware person would quickly lose all their profits and capital. This has made mutual funds the preferred method for investing in Brazil, though even these funds can be caught off-guard as well and be left holding losing positions.

It is not entirely clear whether the recent strength in the Brazilian economy and stock market is here to stay, but the improving infrastructure, low interest rates and inflation are all positives that underpin the market. One mutual fund that has been around for sometime is the Brazil Fund that is attempting to re-charter itself as an open-ended fund. It might be better to wait till its transformation is complete before investing in it.

Another fund, one that tracks the MSCI Brazilian index is the iShares Brazil (EWZ). This is a reasonable way to profit from the general uptrend in the stock market, though you cannot expect a home run here unless the country's economy continues to wear jets. For a more traditional, actively managed mutual fund, you can turn to the Franklin Templeton Emerging Markets fund - which covers Brazil and other emerging economies.

And finally, don't overlook the bond markets from Brazil for higher yields with just as much safety as US treasuries. Look no further than funds such as AIG emerging markets bond fund to invest in the emerging economy bond markets.

In general, there has been an increase in the risk-taking appetite of investors and this has caused them to move even beyond the BRIC countries and Korea, Taiwan etc., and into countries such as Vietnam, Estonia and more! In many ways, this puts countries such as Brazil in a good position since that means if and when a stock market panic sets in, money will stay put in Brazil, while it flees from the new countries.