{"id":57354,"date":"2016-10-20T03:03:00","date_gmt":"2016-10-20T01:03:00","guid":{"rendered":"http:\/\/beta.next-finance.net\/strategie\/the-right-time-to-invest-in-emerging-markets\/"},"modified":"2016-10-20T03:03:00","modified_gmt":"2016-10-20T01:03:00","slug":"the-right-time-to-invest-in-emerging-markets","status":"publish","type":"post","link":"http:\/\/beta.next-finance.net\/en\/strategie\/the-right-time-to-invest-in-emerging-markets\/","title":{"rendered":"The right time to invest in emerging markets?"},"content":{"rendered":"<p><em> <strong>Complete reversal in emerging equity markets in 2016: the highly geared\/cyclical\/risky stocks that collapsed in 2015 skyrocketed in 2016. Where to go? <\/strong>  <\/em> <\/p>\n<p>In 2015, emerging markets have had stormy times. An unexpected devaluation of the Yuan, the collapse of numerous emerging currencies and the implosion of China\u2019s local market were just some of the headwinds. In 2016, emerging markets were back in positive territory benefiting from a more clement economic climate. A rebound in commodity prices, a weaker dollar, a more dovish stance from the Fed,<br \/>\nongoing monetary policy accommodation and stabilization of key indicators in China combined to give a<br \/>\nnumber of emerging markets a new lease of life. All of these elements combined led to a repricing of<br \/>\nrisky assets and to a reversal in the markets.<\/p>\n<p><strong>Improvement of risk\/reward profile for emerging markets<\/strong><\/p>\n<p>More importantly, from an investors\u2019 point of view, there was an improvement in the risk\/reward profile<br \/>\nfor emerging markets: a better compensation for a lesser degree of risk. Indeed, risk, defined as the sum<br \/>\nof current account deficit and short-term external debt levels has diminished, while on the other hand,<br \/>\nthe risk premium (measured by the difference between emerging and developed markets real rates)<br \/>\nstand today at historical highs.<br \/>\n<quote>While developed markets\u2019 monetary authorities continue untiringly their<br \/>\nunconventional policies, emerging countries\u2019 central banks are, for their part, conducting orthodox<br \/>\npolicies which are bearing fruits. Inflation eases while central banks maintain high rates, thus offering<br \/>\nhigh real yields, especially in Brazil, Russia or Indonesia.<\/quote><\/p>\n<p><strong>Promising opportunities for investments<\/strong><\/p>\n<p>\u201c<em>The<\/em>\u201d right time to invest in this universe will always be difficult to gauge and might depend more on<br \/>\nluck than a real know how. However, with today\u2019s improved risk\/reward outlook, it might not be the<br \/>\nworst time to come back into emerging equities for those who still remain hesitant.<\/p>\n<p>It is important to keep in mind that in this reassuring context a crucial element always seems missing:<br \/>\ngrowth. As a matter of fact, many of emerging markets\u2019 structural problems remains intact: weak global<br \/>\ntrade, not comforting developed market growth, high leverage and excess capacity concerns.<br \/>\n<quote>For this<br \/>\nreason, a focus on long-term secular growth and the fundamentals of the countries, sectors and<br \/>\ncompanies is important.<\/quote><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Complete reversal in emerging equity markets in 2016: the highly geared\/cyclical\/risky stocks that collapsed in 2015 skyrocketed in 2016. Where to go? In 2015, emerging markets have had stormy times. An unexpected devaluation of the Yuan, the collapse of numerous emerging currencies and the implosion of China\u2019s local market were just some of the headwinds.<\/p>\n","protected":false},"author":1,"featured_media":57352,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1483],"tags":[1663,1809,1655,1437,2087,2086,2068,2239],"_links":{"self":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/posts\/57354"}],"collection":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/comments?post=57354"}],"version-history":[{"count":0,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/posts\/57354\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/media\/57352"}],"wp:attachment":[{"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/media?parent=57354"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/categories?post=57354"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/beta.next-finance.net\/en\/wp-json\/wp\/v2\/tags?post=57354"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}