Has de-rating of emerging equities reached a turning point?

US dollar strength, weak commodity prices and fears of a hard landing in China have made 2015 another difficult year for emerging market investors, so what next?

Somewhat disappointingly, 2015 is the fifth consecutive year in which EM equities have lagged developed markets. After the recent de-rating, it is not yet clear if a nadir has been reached, or if investors should anticipate further volatility before the cycle turns decisively again. Over the longer term, we still believe returns from emerging equity markets will be superior to those from developed markets - albeit at the price of higher volatility. One way to address EM volatility is through a multi-asset approach, combining debt and equity in a single strategy. Although this means sa...