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Summary Although the economic outlook is not entirely favorable in Central Asia, the current valuation of the Global X Central Asia & Mongolia ETF presents a buy opportunity. While falling commodity prices have slowed economic growth in Central Asia, and will still present challenges ahead, it still has a favorable investment climate. The fund is trading extremely close to its 52-week low, is trading below its book value, and has a P/E of 11.34. Countries that are currently suffering from low commodity prices actually present excellent buy opportunities. Global X Central Asia & Mongolia ETF (NYSEARCA: AZIA ) is at a very strategic buy point, as it is trading near its 52-week low and has extremely low valuation. It invests into high-growth countries in Central Asia that have had an economic downturn due to falling commodity prices. The fund’s price drop to 9.53, far from its 52-week high of 14.45, has provided very favorable valuation . P/E Ratio: 11.34 P/B Ratio: 0.98 P/S Ratio: 1.28 A combined look at the macroeconomic outlook for Central Asia and the performance of the individual fund holdings shows that while economic growth will be slower and some companies have had setbacks in financial performance, the impact on the fund’s price has been sensationalized. Many companies were not drastically impacted by the decline of commodity prices, and have a favorable future outlook. This shock in the fund price has created opportunities for investors to invest in a fund trading below its book value, and that has room for growth amidst the economic challenges that Central Asia has ahead of it. Macroeconomic Outlook GDP growth has most recently been substantial, and is impressive to note given the fund’s sharp drop in price. While the GDP growth forecast for 2016 is less favorable overall, the growth is still impressive for Asia and a favorable climate for investment. The IMF has projected a 2% decrease in growth in Central Asia, due to lower commodity prices and the economic downturn in Russia. Inflation is another issue this region will continue to face, as inflation is projected to increase from 4.82% to 5.45% in 2016. As seen by an assessment of the fund’s holdings later in this article, commodity prices have had a mixed effect on the companies while companies with operations in Russia have witnessed a threat to financial performance. While Central Asia may not be the best environment for investment, the key opportunity presented here is within the fund, rather than the region. Moreover, the majority of the fund’s holdings are listed on US exchanges, providing investors with the opportunity to cherry pick the most favorable options, and to potentially avoid waiting long term for Central Asia’s holistic recovery. Top Exports As many of these countries rely on revenue from exports, the declining price of commodities has resulted in slowed economic growth. The fund’s performance is therefore correlated with the successful outlook for commodity exports and price recovery of commodities, with oil prices having the largest overall effect on many of these countries. Fund Holdings A closer look at the fund’s top holdings, which comprise 65.8% of the fund’s total holdings, provides a favorable outlook. Although the fund’s price sharply dropped since its high of 14.45 in 2014, financial performance of the fund’s holdings has not been poor enough to make this sharp drop in price justifiable. Dragon Oil ( OTCPK:DRAGF ) increased its net income from $512.6 million to $650.5 million in 2014. Although Highlands Bancorp ( OTCPK:HSBK ) was able to drastically increase net revenue, it still witnessed a sharp decline in net income in 2014 from $2.3 million to $0.7 million. The company has a P/E of 14. KMG Chemicals (NYSE: KMG ) increased its net income from $9.3 million to $13.8 million in 2014, and its net revenue from $263.3 million to $353.4 million. KCell JSC GDR’s net income decreased from 63,392 KZT Million to 58,271 KZT Million in 2014. Nostrum Oil and Gas’s net income fell from $220 million to $146 million. Turquoise Hill Resources (NYSE: TRQ ) has consistently been increasing its bottom line since 2010, resulting in the beginning of profitable operations in 2014. Vimpelcom ( OTC:VMPLY ) operated at a loss of $903 million in 2014, and its revenue continues to be threatened due to its operations in Russia . MIE Holdings ‘ net income fell from $45.6 million to $9.4 million in 2014. Mongolian Mining Corporation ( OTC:MOGLY ) had a substantial drop in net income and net revenue, and is being threatened by increased operations costs and the declining price of coal. Conclusion Overall, the financial performance of the fund’s holdings was exceptional, and the sharp drop in the fund’s price during this year is not entirely befitting. A buy opportunity has thus emerged, either directly into this fund, or into some of the individual holdings. Low commodity prices and economic adversity in Russia have been negative drivers for this fund, although they have not completely deterred the fund’s performance. While the fund is overall a favorable endeavor, Dragon Oil stands out the most at first glance, due to its lower valuation and growth in 2014. The level of growth projected for the future in Central Asia is still acceptable, and the valuation of this fund is certainly superior, when compared to other alternatives in Asia. While the threat of commodity prices poses an exceptional risk, the fund’s superior valuation and the buy opportunity that has thus emerged makes it a worthwhile endeavor. Central Asia is merely one of many destinations that is currently suffering from the drop in commodity prices; I have previously mentioned Peru , Chile , and Brazil as having similar opportunities. This current economic situation has created global buy opportunities, and Central Asia is surely one destination with ample potential for a rebound. Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. (More…) I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.