CFA UK: Investor sentiment towards EM equities improves despite lingering concerns

Over half of respondents now see EM equities as undervalued

Investors saw much greater value in emerging markets in Q3 than in the previous quarter, according to the CFA UK's Valuations index, as they perceive stocks in the region to be undervalued following the sell-off this year.

Some 53% of the total 245 respondents to the survey now consider emerging markets equities to be either "very" or "somewhat" undervalued, an increase of 11 percentage points (ppt) from the previous quarter. Meanwhile, just 10% of investors see developed market equities as "very" or "somewhat" undervalued, a decrease of 1ppt from Q2. Will Goodhart, chief executive of the CFA UK, said the significant improvement in sentiment towards emerging markets was the result of the significant currency sell-offs in EM countries such as Turkey, South America and South Africa. Emerging markets ha...