Emerging Markets funds

Thrugelmir

bostonerimus wrote: »

I'd go for a low cost EM tracker if I was going to overweight this sector, but I don't bother as my EM investment comes from a cap weighted global ex USA tracker fund. As the EM market cap grows/falls so will my investment in it.

Personally I prefer investments to be screened in such markets. Simply buying a share because investors have chased the price skywards. Isn't palatable currently. India and Asia are not as mature as the US markets for example. Not as well researched. Nor is Corporate governance etc at the same level. I'd prefer local investment managers monitoring the holdings.

Cash-Cows

I use an EM tracker. Not everyone!!!8217;s cup of tea I know but I was more concerned with picking a dog than with out performance.

bostonerimus

Thrugelmir wrote: »

Personally I prefer investments to be screened in such markets. Simply buying a share because investors have chased the price skywards. Isn't palatable currently. India and Asia are not as mature as the US markets for example. Not as well researched. Nor is Corporate governance etc at the same level. I'd prefer local investment managers monitoring the holdings.

This is why I don't overweight EM in my portfolio.

LULULU1

Interesting discussion.

On you tube there are some really interesting debate videos in favour and against managed and active funds.

coyrls

LULULU1 wrote: »

Interesting discussion.

On you tube there are some really interesting debate videos in favour and against managed and active funds.

There is an endless debate about this, I just wanted to point out that to say:

emerging markets are universally agreed to be better catered for by managed funds

is factually wrong.

Audaxer

bostonerimus wrote: »

This is why I don't overweight EM in my portfolio.

What percentage of a portfolio invested in EM funds is classed as overweight?

ceivegz

dunstonh wrote: »

The important thing with Emerging Market funds is not what they did last year.



And periodically, it tends to do so with emerging market funds. You are looking at 90% loss potential.

Nonsense! Maybe if you invest solely in one small emerging market, say Bolivia or Cambodia, but if you stick to a single region (Latin America, Far East, Africa etc) or even better find a fund that covers a range of emerging markets (maybe the BRICS+, or BICS of you think Russia stinks) you have a natural hedge against turbulence or political risk in any one market.

ceivegz

Unless you're willing to invest in individual companies from China, Russia, Latin America or India that have US or London stock market listings you will need a degree of good local knowledge and information as many of the companies in these markets aren't well researched or reported on and will not have to comply with very strict reporting requirements as those needed to list in London or New York. I would opt for funds specialising in the regions but would go a step further and go for a fund that has an additional level of due dilligence such as an ethical fund manager such as Alquity. An ethical and managed approach to investment in such regions significantly reduces company-risk and political risk in each individual investment made by portfolio managers.