Turkey and Egypt offer opportunities in crowded EMs

ON EMERGING MARKETS

Castlestone Management's Arrash Zafari believes investors should look to areas where growth has already returned to pre-crisis levels.

In 2011 we expect emerging markets to continue their upward trend, but at levels below those seen in 2010 when the MSCI Emerging Market index gave a return of 16.36%, 3.79% above the S&P 500. Caution is warranted in the short-term, given strong recent performance by the asset class, in particular, the capability of these countries to drive economic growth against inflationary pressure will be a distinct theme. Yet considering on-going economic turbulence and tightening, a notable chunk of emerging market equity growth may come from developing markets that source economic growth intern...