Emerging markets not decoupling from developed world but are 'increasingly important' allocation say managers

Emerging market weightings in the MSCI ACWI have increased over the last two decades from nearly 1% in 1987 to 11% in 1997

The argument that emerging and developed markets are decoupling weakened further this week as a report from MSCI Barra reveals the correlation between the MSCI's Emerging Markets and World Indices has almost doubled in the last 20 years. The rise in correlation from 0.48 to 0.8 between 1988 and 2007 has been caused by financial markets integrating on a global scale. During the mid-1990s, correlations of the MSCI Emerging Markets Index and the MSCI Emerging Markets regional indices with the MSCI World Index were very low. They increased to reach relatively high levels by the end of 199...