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Let’s talk about something few people have any interest in talking about this year.
I swear, this is not because I want a large portion of you to close this browser window. But in investing, the best times to talk about something is often when people have the least interest in talking about it.
Let’s talk about emerging markets (EM).
An Afterthought, and Not Hard to See Why
Frankly, it isn’t difficult to see why investors have had little interest in EM lately. It is currently in one of the longest bear market drawdowns in the history of the asset class, having peaked nearly a full year before the S&P 500 did earlier this year.
The relentless strength of the dollar—arguably the biggest macro driver of EM returns—has tightened liquidity globally and squeezed EM investor returns.
And the Chinese government has been on a regulatory rampage, issuing one body blow after another to many of its largest tech companies.