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Is It Time To Re-Look at Emerging Markets?
The COVID-19 crisis has ravaged returns globally. EM provides the return potential that investors need. But the world has changed and successful EM investing needs the right approach for now. Take a look at EM.
- Emerging Markets (EM) have evolved significantly over the last two decades—benefitting from economic growth driven by productivity gains, implementation of various structural reforms and consumption growth from their rising middle-class population.
- EM countries currently contribute to 60% of the world’s GDP and have a 40% share in the world’s global trade.
- EM financial markets have also grown in variety, size, depth and liquidity from their early days, to being considered as an essential allocation for a balanced portfolio.
- The long-term outlook for EM remains positive. With favorable demographics, robust technological advances, rapidly growing urbanization, improvements in education and healthcare – emerging economies are expected to be the key drivers of global growth in the coming years.
- Collectively, these long-term drivers of growth can often lead to enhanced returns, meriting their consideration for the growth component of investor portfolios.
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07/31/2021