emerging markets investing: stick or twist?
TRANSCRIPT
EMERGINGMARKETSINVESTING:STICK OR TWIST?
This report is a timely look athow global institutionalinvestors are thinking about andpositioning their investments inemerging economies.
These are the results of aglobal survey of seniorinvestment professionals.
277 RESPONDENTS
Demographic of report respondents
32% CHIEFINVESTMENT OFFICER
44% USA | 31% EUROPE
PROPORTION OF FIRM'STOTAL AUM INVESTED INEMERGING MARKETS: 38%
OUR TOP TENFINDINGS
China failing to hit it's 7%
economic growth target is themacro-risk that is considered most
likely to cause a sharp sell-off inemerging markets assets in 2016/17
#1
OUR TOP TENFINDINGS
Local currency equities,government and corporatebonds are expected to beimpacted most by risingrate volatility, particularlyamong the BRICS countries
#2
OUR TOP TENFINDINGS Most respondents (36%)
expect the combinedeconomic growth rate ofdeveloping economies in2016 to be flat to 4.3% in2015. 34% expect it to fall,
while 29% expect thegrowth rate to rise.
#3
OUR TOP TENFINDINGS
India is the most preferred economy ofthe BRICS to invest in over the next 12-
24 months, followed by China andSouth Africa. Russia is the least preferred, followed by Brazil.
#4
OUR TOP TENFINDINGSWhile there is concern
about the Chinese equitiessell-off, a higher proportion ofrespondents are concernedor very concerned about thegovernments's attempts totry and stem it.
#5
OUR TOP TENFINDINGS
#651% of respondents do not believeChina will overtake the US as theworld's largest overseas investor by2020. About 30% said it would.
OUR TOP TENFINDINGS
#7 Most respondents(29%) believe that thesize of India's economywill not surpass China'sanytime soon. 23%said it would
happen in 20 years.
OUR TOP TENFINDINGS
#8Over the next 5-10 years,68% of respondents seeinvestment potential ofCuba, closely followed
by Iran (66%).
OUR TOP TENFINDINGS
#9Most respondents (67%) either agree orstrongly agree the the usual response ofselling emerging markets assets duringdeveloped market crises should be re-
assessed by global asset managers.
OUR TOP TENFINDINGS
#10Some 60% ofrespondents eitheragree or strongly agreethat developed marketrisks are under-pricedrelative to developingmarket risks.
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