Opportunity prevail in emerging markets despite gloom and doubt
Investors should not be turned off China and other emerging markets because of gloom and doubt over their economies, a portfolio manager believes.
Van Eck emerging markets equity strategy portfolio manager, David Semple, said there were reasons to be optimistic about the sector despite the shaky start to 2016.
"We anticipate better economic numbers out of China," he said.
"China gets the blame for just about everything bad that happens in global markets, but the reality is different.
"As emerging markets become bigger, the key is to be very specific about where to invest.
"There are companies in the technology, healthcare, tourism, education and insurance sector that will generate higher profitability this year.
"Overall, we expect lower, but better, growth from China, with continued monetary and fiscal easing in 2016.
"We expect the currency, the RMB, to depreciate versus the US dollar in a modest and fairly controlled fashion, assuming the US dollar continues to be strong versus other major currencies.
"It's also worth noting that offshore Chinese shares are historically relatively cheap compared to other emerging market and developed market countries."
AUTHOR
Staff Writer
Recommended for you
The role of alternative investments is to diversify a portfolio and capture differentiated sources of return, according to UBS Asset Management.
Private investment opportunities are moving up on the list of what investors want from their financial advisers, according to Natixis IM, and over half of firms say they are offering them more strategies.
Two asset managers have each expanded their product suite with the launch of new global equity funds for Australian investors.
Perpetual has confirmed it is in exclusive talks with global investment company KKR regarding an acquisition of its corporate trust and wealth management businesses.
