Portfolio diversification and EM opportunities

Practical takes from DE Shaw, Bruegel, S&P Global, and more

Portfolio construction continues to be a hot topic. As does emerging markets – and for the same reason: uncertainty stemming from the U.S, which has been the world’s source of stability for decades. Some investors now think otherwise and are adjusting their portfolios accordingly.

Portfolio diversification

Rethinking the Traditional 60/40 Portfolio (Sarmaya Partners)

Investors will likely soon witness a major secular shift in financial markets involving interest rates, inflation levels, and currency prices.

Infrastructure Within a Portfolio Context (PMR)

Investing in infrastructure generally helps diversify portfolios and offers downside risk protection and consistent income yields.

Worth Its Weight? Assessing Gold’s Portfolio Utility (DE Shaw)

Is gold as good a diversifier as its reputation suggests? This question is thoroughly answered in this report.

How Buffer ETFs Promise to Protect Your Portfolio (Alpha Architect)

While buffer ETFs are not inherently good or bad, they fall short in one critical area at the heart of risk management.

The Buck Stops Where? FX Risk-Proofing for the Long Term (State Street)

Aaron Hurd, senior portfolio manager at State Street Investment Management, takes part in a wide-ranging discussion on FX and portfolio construction.

Emerging markets analysis

China Inc. Heads to Global South in the Age of Tariffs (S&P Global)

Leading Chinese firms are heading to the global south amid rising U.S. tariffs on Chinese goods since 2018.

The Search for Loss Absorption in Africa (Lazard)

Sovereign debt reduction is a slow and difficult process. This has especially been the case in Africa.

Weak Dollar, Strong EM (Invesco)

EM local debt is sensitive to U.S. dollar movements – it has a 0.71 correlation on a quarterly basis with the U.S. dollar index.

The Chinese Economy: Stimulus without Rebalancing (Bruegel)

Chinese industrial production has grown so much that not even very strong exports have been able to absorb it all, resulting in overcapacity.

Dissecting 2025: Emerging Market Debt Stability in a Stormy Year (Manulife IM)

For compliance reasons, this paper is only accessible in certain geographies

EM debt has been through a tumultuous year. What lies ahead for this asset class, and how should investors think about it?