Finding Investment Opportunities in Emerging Markets

Within emerging markets the Asian region provided the main winners in 2014 thanks to the sharp decline in the oil price. But what can investors expect from 2015?

Simon Dorricott 2 July, 2015 | 1:09PM

Emerging market investors had a difficult time in 2014, with returns lagging developed markets. Over the year as a whole the MSCI AC World Index showed a total return of 8.6% in sterling terms against a meagre 1.4% return for the MSCI Emerging Markets Index. Within emerging markets the Asian region provided the main winners, with the sharp decline in the oil price seen in the latter part of the year being beneficial for the majority of countries in the region as they are net oil importers.

The election in Brazil led to a volatile market, while weak commodity prices had an adverse impact

Particularly strong performance was seen from the Indian market, which rose over 36% in sterling terms on the back of this and, more importantly, expectations surrounding the election win for Narendra Modi and his reform agenda. Positive returns were also seen from Chinese equities as investors continued to channel capital into the market, particularly A-Shares, despite the marked slowing of GDP growth resulting from the government’s attempts to rebalance the economy.

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About Author

Simon Dorricott  is a Senior Fund Analyst for Morningstar

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