Emerging markets could see real returns of 7.5% per annum for the next decade, according to a paper published by Research Affiliates.
The paper, The Emerging Markets Hat Trick - Time To Throw Your Hat In, explained how emerging markets offer good value and strong predicted returns despite the rebound already seen in the asset class this year. In fixed income, the predicted yield spread between emerging market debt and developed markets is 5.2%, while emerging market currencies remain around 19% below fair value relative to the US dollar. The paper depressed currencies, powerful momentum and exceptional valuation levels as the ‘hat trick', a term that originates from hockey, used to describe the rare occassion when a...
To continue reading this article...
Join Investment Week for free
- Unlimited access to real-time news, analysis and opinion from the investment industry, including the Sustainable Hub covering fund news from the ESG space
- Get ahead of regulatory and technological changes affecting fund management
- Important and breaking news stories selected by the editors delivered straight to your inbox each day
- Weekly members-only newsletter with exclusive opinion pieces from leading industry experts
- Be the first to hear about our extensive events schedule and awards programmes