Mobius: If you have less than 30% in EM, you are underweight

Mark Mobius, executive chairman of the Templeton emerging markets group, has urged investors to hold at least 30% in emerging markets to ensure they are properly diversified.

Speaking at the annual Morningstar UK Investment Coference, Mobius (pictured) said this allocation should include 3% in frontier markets, reflecting the weight of emerging economies in global equity markets. For investors willing to invest on a five-year view, Mobius suggested increasing allocation to EMs to 40%, including a 15% allocation to frontier equities, an asset class on which he is particularly bullish. "Last year, 33% of global IPOs were in emerging markets, so I always tell clients that if they have less than 30% in emerging markets, they are underweight," the manager said....