Emerging markets are a currency trade with equities attached
The index traded at 67.97, +0.28% today. Most of the return dispersion in EM comes from something other than the companies.
Russell 2000 internals, EM equity flows, and special situations the large-caps miss.
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The index traded at 67.97, +0.28% today. Most of the return dispersion in EM comes from something other than the companies.
Small caps look cheap against large caps. A large share of the index loses money, and that part of it has no earnings for a valuation to recover to.
The payout trends I track across the state-linked companies in the index.
Support for the economy tends to come in stages rather than one large package. Markets rally on each stage and then wait for the next.
When investors worry about a government's finances, the currency weakens before the equities do. For a dollar investor, that is most of the loss.
Large Chinese companies trade at valuations that assume very little goes right. That makes the bar for a rally low.