The quality of the emerging market (EM) universe has improved “dramatically”.
This is what Ninety One co-head of EM sovereign & FX Grant Webster said today (21 May) at a roundtable event.
Webster added that positive outlook outweighs negative two to one in the EM space.
He does admit that 10 to 12 years ago, EMs did look “terrible” but this has changed significantly.
Ninety One chief sustainability officer Nazmeera Moola added that the interest in EMs is much higher than it was a year ago.
She said there is a “visible increase in exploring new opportunities”.
Additionally, despite a lot of investors seeing EM as being too scary and holding too much risk, Moola pointed out that the spread of risk between developed markets and EMs are not as big as people think.
Ninety One co-portfolio manager for the EM equity and EM ex-China equity Varun Laijawalla claimed EMs are even looking less risky than developed markets to certain investors.
In July 2024. Templeton Emerging Markets Investment Trust (TEMIT) lead portfolio manager Chetan Sehgal told Money Marketing that EMs in many sectors are now “equal or better than developed countries”.
Webster said: “I think you have seen very sensible policy making in EMs compared to the US,” referring to the tariffs US president Donald Trump has recently introduced.
In April, Martin Currie, head of the global long-term unconstrained team and manager of Franklin Global Trust Zehrid Osman said the tariffs imposed by Trump could result in portfolio managers and investors looking “elsewhere for opportunities outside of the States”.
Ninety One portfolio manager, EM leaders strategy Juliana Hansveden added there has been more interest in EM equities, with a significant shift in the past 12 months, especially in the wealth management space.
Also, EMs are increasingly trading with each other and becoming less dependent on the US, she said.
