‘Hot’ money fails to slow emerging market inflows
Fund managers are devoting considerable resources to the emerging markets sector despite strong returns attracting ‘hot’ money to the sector within some countries, according to a Standard&Poor’s review.
This indicates that the managers will remain committed even when the current high level of investor interest abates, suggesting emerging market equities is not just a faddish asset class,” S&P fund analyst Tara Bell said.
The managers in the S&P 2007 emerging markets review consider the sector a “viable portfolio proposition for the long term”, she said.
The review found that there has been no significant increase in new products launched in the sector in 2007, nor, conversely, rationalisation of existing ones, Bell added.
It found that new products introduced by managers have tended to be broader, regional rather than single-country, offerings, with the exception of Fidelity Investments (Fidelity), which offers stand-alone India and China products as part of its regional suite.
The 2007 review examined a total of 16 managers (some managers are represented in more than one peer group), with S&P star ratings applied to 40 funds.
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