Emerging markets stocks look attractive relative to U.S. peers, but not all countries within the asset class are created equal, says Daniel Graña, Portfolio Manager, Emerging Market Equity. Case in point: South Africa.
- Emerging markets (EM) stocks underperformed U.S. equities in 2019, helping improve the relative attractiveness of EM equities. However, as South Africa demonstrates, we believe investors should not paint all developing markets with the same brush.
- In South Africa, poor policy choices have led to a spike in government debt and double-digit unemployment, threatening the country’s credit rating.
- Meanwhile, other regions within EM, specifically Asia, are adopting growth-oriented reforms and innovating.
Subscribe for relevant insights delivered straight to your inbox