The very different economies grouped under the emerging markets label offer contrasting prospects for investors. India, for example, continues on a gradual reform path and we believe its outperformance is not a quirk and should continue.
China's attempts at market liberalisation have though illustrated the regime's inexperience in capital markets and its equity market is likely to continue to trade at a discount. Brazil needs an 'Argentina moment' to remove President Dilma Rousseff before it can meaningfully recover, so it is too early to try to catch this falling knife, while South Africa is another example of the importance of political and economic leadership. The wider question is whether the emerging markets label remains a valid one? Does this approach give the investor exposure to the parts of the world they wa...
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