Blend of equities and debt is best way to play EMs

ON EMERGING MARKETS

AllianceBernstein's Morgan Harting explains why the traditional all-equity approach to investment in this area is not the best approach.

The share of the world’s gross domestic product generated by emerging and developing countries is likely to overtake that of “advanced” countries by 2013. Capturing a share of that growth is going to be vitally important for the well-being of investors in less dynamic economies. Tapping the markets of the 67 emerging countries could also add to the diversification of their portfolios. Unfortunately for UK institutions, the rosy prospects for EMs have largely been priced into many individual stock and bond valuations at a time when institutions are often heavily underweight. Is it too ...