Emerging market investing focuses largely on Brazil, Russia, India and China, or namely the BRIC countries. As it turns out, an entire continent also has quite a bit of growth appeal. And the fact that it is still in the early growth stages means that smart investors still have time to act before the crowd catches on.

Investors may be surprised to learn that the collective gross domestic product (GDP) for the African continent is projected to grow by as much as 7% in 2011, according to the African Development Bank. And recent Financial Times article detailed that Africa as whole has as many fast-growing cities as China, with more than 50 that have populations of 1 million or more.

The African economy is as large as Brazil’s or Russia’s individually, with a total GDP of more than $1.6 trillion. The continent is learning how to compete on a world stage and can easily hold its own with the best of the emerging market economies.

If you’re interested in gaining exposure to a corner of the world that most investors don’t pay attention to, but could possibly be “the next big thing,” Africa is worth considering. With that, here are ways to position your portfolio to profit from Africa’s strong growth potential.

Diversified Exposure Through Funds/ETFs
A strategy to gain diversified exposure to Africa is through either mutual funds or exchange-traded funds (ETFs). A new mutual fund I recently came across is the Nile Pan Africa Fund (Nasdaq: NAFAX). Its performance since inception (April 28, 2010) reflects the investment interest Africa has received as of late. The fund focuses on active management and finding compelling investments in all of Africa. It returned more than 23% during 2010 and is still bullish on the continent. A recent information piece from the firm highlighted that Africa is very rich in commodities, with an estimated 13% of the world’s oil reserves, 50% of its gold reserves and more than half of its cobalt and platinum reserves. In terms of ETFs, the Market Vectors Africa Index Fund (NYSE: AFK) invests in the 50 largest firms in Africa and represents one of the best ways to gain immediate and broad exposure to Africa as a whole

South Africa as a Beachhead
The MSCI South Africa Index Fund (NYSE: EZA) offers broad exposure to the leading firms in South Africa, a location that also makes sense for investors more interested in buying shares of individual companies. South Africa is a logical beachhead for investing in Africa, as its economy is the largest in the continent and also the most developed. That being said, it still qualifies as an emerging market. But this is a good thing because economic growth has been robust and is projected to continue. GDP growth has slowed from 5.5% in 2007 but should still be respectable in the coming year at close to 4% and will improve along with the global economy.

South Africa also has a well-developed stock market, with a number of globally competitive companies. Investing in the country represents one of the best opportunities for investors to position their portfolios toward gold, with leading gold mining firms in AshantiGold (NYSE: AU), Gold Fields Ltd (NYSE: GFI), Harmony Gold (NYSE: HMY) and DRDGold (Nasdaq: DROOY). Sasol (NYSE: SSL), a leading integrated energy firm, and SABMiller (OTC: SBMRY), one of the largest brewers in the world, are other options for investors interested in individual companies.  

Action to Take —> Bottom-up investors would be well served to focus on opportunities in South Africa. The rest should find a fund or ETF option for diversified exposure. As a proponent of active management, the returns of the Nile Pan Africa Fund suggest it is skilled at finding profitable opportunities in Africa. In terms of individual stocks, Sasol is a compelling energy play given the markets it serves, low valuation and dividend yield of about 4%. SABMiller is also on my watch list: I love the company but the stock has run quite a bit higher lately and you should wait for the stock to stop to take a breather before considering jumping in.

Disclosure: Ryan Fuhrmann does not own shares of any security mentioned in this article.