We first covered the Market Vectors Africa (NYSE: AFK) ETF  back in our August 2008 issue of StreetAuthority Market Advisor. Africa is a mix of developing and frontier economies. On one end of the spectrum you have South Africa, which boasts of a stable and growing middle-class, modern infrastructure, a well-developed financial system, and the 17th largest stock exchange in the world.

You also have many regions like Ghana, which has thriving industries related to gold and cocoa, but where more than half the population is still agrarian-based. And of course you have regions like the Congo, rich in natural resources, but where violent conflict is still a reality.

When taken together, however, you have a treasure trove of natural resources and fast-growing economies. And that’s what AFK does — it puts this them together in an exchange-traded fund (ETF) making it easy for U.S. investors to tap into this normally hard-to-reach region.

This ETF tracks the performance of the Dow Jones Africa Titans 50 Index, which represents 50 of the largest publicly traded companies that generate the majority of their earnings in Africa. The largest holding is British-based Tullow Oil, which operates primarily in Africa. Oil and gas related companies make up just a little over 13% of the fund’s holdings. 20% of the fund’s portfolio represents natural resource companies like Randgold Resources (Nasdaq: GOLD) and Aquarius Platinum. 12% is invested in some of the fastest-growing telecommunication markets in the world. The largest percentage of the fund’s holdings hail from the financial sector; approximately 30% of the portfolio is made up of banking companies like First Bank of Nigeria and Standard Bank Group.

Last fall, troubled hedge-funds were forced to quickly unwind their positions and many of these were invested in frontier and emerging economies. The rapid decline of oil and other commodity prices also drove down prices in resource-rich markets like Africa.

But both these trends seem to be reversing. Money is again finding its way back into emerging market investments and commodity prices have begun their long road to recovery. This has been good for AFK. While still well off its 52-week high, AFK is up roughly +15% year-to-date, compared to the relatively flat performance of the S&P 500.