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Emerging Market Equities - Process and Outlook

White Papers for EM Investors, Allocators and Fund Managers

Since our May 2016 blog post, "Have Emerging Markets bottomed?" the MSCI EM Index has gained around 20%. Are Emerging Market Equities still a solid overweight?

The first two papers below explore the outlook for EM Equities. The next eight papers have been selected for asset allocators and fund managers within the EM Equities sector; to aid in the search for  both stock alpha and asset allocation alpha.

Istanbul skyline emerging market equities papers

The Future of Emerging Market Equities (BNP Paribas, Apr 2017)
In recent years, the performance of EM equities compared to DM equities has been disappointing to investors. Is the recent rebound in relative performance temporary or structural?

EM Outlook 2017: Risks Remain, But Reasons for Optimism (William Blair)
The past 12 months have been turbulent in emerging markets, but several factors support emerging market performance. Growth in developed markets should benefit export-driven emerging markets. Emerging markets outlook in 2017 is optimistic.

Capturing the Chinese A-shares and H-shares Anomaly (FTSE Russell, 2016)
The Chinese equity market is consisting of an offshore and domestic market. As barriers to entry are easing, investors are looking to for a diverse range of aspects of the Chinese equity market.

Does the Shiller-PE Work in Emerging Markets? (2012)
This paper examines how reliable CAPE, or Shiller PE, is when utilized as a tool for valuation and forecasting for thirty-five countries including emerging market economies.

Does economic growth drive emerging market equity returns? (2012)
This paper argues that the statement that emerging markets economic growth drives emerging markets equity returns is intuitively powerful. Unfortunately the evidence suggests that economic growth is only part of the story.

China through the mosaic of its share classes (FTSE Russell)
China’s share classes represent the arc of the country’s transformation from a dormant agrarian society to bustling centre of global commerce. Each new class has marked both an increased openness and often a new phase in development.

Value and Momentum Strategies in Latin America (S&P Dow Jones Indices, 2017)
The paper explores how reducing risk through diversification, specifically in Latin America could be achieved. Due to the relative volatility within the region, negatively correlated factors could provide an effective answer.

Introduction To The Frontier Markets and The Opportunity They Present
Frontier markets, from Argentina to Zambia, grant investors the opportunity to utilize growth patterns and economic conditions varying from those found in more developed economies.

Factor Performance in Emerging Markets (Lazard, Apr 2016)
The authors examine emerging market factor returns over a 10-year period. The report is helpful, both for stock pickers and quants, helping to explain the stock-selection styles in emerging markets, and a multi-factor approach.

Africa, the next investment frontier (Robeco, 2016)
Robeco examine some of the key themes and trends driving African equity markets. The paper mentions: GDP; Investment Flows; the Consumer; Infrastructure; Pension Fund and Insurance Assets; Private Equity; and Valuation.