Newton's Global Opps managers cut EM exposure to zero on Asia debt fears

Valuation do not provide margin for error on downside

The managers of the £312m Newton Global Opportunities fund have removed all emerging market exposure, after briefly returning to the region, on the view valuations are not sufficiently cheap to provide enough margin for error on the downside.

Raj Shant (pictured), alternate manager on the fund to Robert Hay, said areas of Asia are yet to complete their credit cycle, and are taking on far too much debt, despite the region offering the most attractive secular growth opportunities globally. "We are cognisant that emerging markets have underperformed developed markets for nearly four years now so there should be some good risk/reward profiles," he said. "However, that time is not yet. If there is another leg to the EM credit crisis then we want to be ready to benefit from that, then sit back and let markets do the work at the ...