Are you still invested in emerging market equities?

The truth behind 'cheap' valuations

clock • 4 min read

Over the past year or so, investors may have read numerous articles by emerging market (EM) equity fund managers highlighting the current low valuations in their asset class and why this makes it an attractive investment case.

It is certainly the case that EM equities currently look cheap compared to its developed counterpart on pretty much every metric, whether that is EV/EBITDA (enterprise value-to-ebitda), P/E (price-to-earnings) or P/B (price-to-book). However, this misses two important points. The first is that emerging market equities have always been cheap compared with developed markets and it would be unwise to bet against this changing overnight the next time the cycle turns. Investing in emerging markets healthcare: The main market drivers For example, a forward P/E ratio of 12 for emerging ma...

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

Join now


Already an Investment Week


More on Emerging markets

(L-R) Sanjay Shah and Nilang Mehta, portfolio managers at HSBC AM

HSBC Asset Management's Shah and Mehta: There are bright spots when investing in India

Diwali boost to Indian investment

Sanjay Shah and Nilang Mehta
clock 15 November 2023 • 4 min read
David Kimberley (pictured), investment trusts writer at Kepler Partners

Kepler Partners' David Kimberley: Emerging market shifts

We live in interesting times

David Kimberley
clock 14 November 2023 • 4 min read
Andrew Ness (pictured), manager at Templeton Emerging Markets Investment Trust

TEMIT's Andrew Ness: The sustainable investment opportunity in emerging markets

Three opportunities

Andrew Ness
clock 31 October 2023 • 3 min read