Emerging Market Manager Thoughts … In the Air

As this post hits your in-box, I am in the sky to a coast line state for multiple business meetings for the remainder of the week.

Recently in our “Sipping from a Fire Hydrant Post” a lunch with three emerging market portfolio managers was discussed.

As a reminder, Emerging Markets are smaller, less mature countries that MAY be in growth mode … think Brazil, Russia, India and China aka The BRIC’s (Examples, not recommendations … must pick carefully)

Emerging Market Portfolio Manager Thoughts

Research Affiliates latest expected return … higher means better return, BUT farther right means more risk too … no free lunch!

6-8-15 Research Affiliates Expected Returns

  • More volatile than mature markets (this is obvious, but worth repeating)
  • Where the growth is looking into the future (think mature/USA markets 50-60 years ago)
  • Political stability is VERY important (bad policies can bankrupt a small country)
  • Hold off on investing in this category until rates in the USA start to rise (WHAT … See below!)

WOW… I saved the best for last, these guys make their living investing in emerging markets, and they all but said, hold off until rates rise as they were concerned on how their currencies would move as rates rise in the USA.

Sounds like an opportunity!

Will chat with you Friday from the Road

Have a Great Wednesday!

John A. Kvale CFA, CFP

8222 Douglas Ave # 590
Dallas, TX 75225




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