Frontier Markets

Optimizing International Equity Allocations

July 27, 2015 | Author: EGA Investment Strategy | Categories: Chart of the Week, Investment Strategy, Emerging Markets, Frontier Markets

Optimizing International Equity Allocations
As we have previously discussed (Emerging and Frontier Markets Have Improved Diversification, July 14, 2015), EAFE is not a good diversifier of U.S. equity portfolios. While EAFE equities have risen on expectations of a successful QE program and U.S. equities have appreciated on expectations of further earnings growth, EM equities have not participated in a sustained post financial crisis global equity rally. On the other hand, despite its high volatility profile, EM offers diversification to U.S. investors....
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Emerging and Frontier Markets Have Improved Diversification

July 14, 2015 | Author: EGA Investment Strategy | Categories: Chart of the Week, Emerging Markets, Frontier Markets

Emerging and Frontier Markets Have Improved Diversification
A portfolio consisting of just U.S. and EAFE is by no means diversified. The 52-week correlation between U.S. and EAFE equities is high at 0.76. Diversification may reduce portfolio volatility and also may serve to preserve capital by allocating money to a variety of different investments. Investors would be better served to concern themselves with portfolio-level volatility, rather than that of its component assets. The inclusion of EM and FM equities, as our chart shows, has consistently reduced inter-asset correlation considerably and improved diversification....
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Risky Business? Rethinking International Equity Allocations

July 13, 2015 | Author: EGA Investment Strategy | Categories: Investment Strategy, Emerging Markets, Frontier Markets

Risky Business? Rethinking International Equity Allocations
When approaching asset allocation, equity investors often follow a top-down, macro-economic approach to consider the merits of each country or region in their portfolio before considering the characteristics of individual securities. We have noticed that many investors focus on riskiness or volatility of an asset class at the expense of the overall risk-adjusted returns or how different investments work together in a portfolio. The inclusion of EM and FM equities has reduced inter-asset correlation considerably and improved diversification....
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The Emerging Markets Update: 2Q15 Review and 3Q15 Preview

July 13, 2015 | Author: EGA Investment Strategy | Categories: Investment Strategy, Emerging Markets, Frontier Markets

The Emerging Markets Update: 2Q15 Review and 3Q15 Preview
In a rollercoaster quarter, the MSCI Emerging Markets (EM) Index held on to slender gains outperforming both the S&P 500 (+0.3%) and the MSCI Frontier Markets (FM) Index (+0.1%). Inflows returned to EM equity ETFs as the U.S. Federal Reserve pushed back the timing of its first interest rate hike. In the Emerging Markets Update, the EGA Investment strategy team discusses the events in the second quarter and previews their thoughts on what's in store for 3Q15....
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The Emerging Markets Update: 1Q15 Review and 2Q15 Preview

April 15, 2015 | Author: EGA Investment Strategy | Categories: Investment Strategy, Emerging Markets, Frontier Markets

The Emerging Markets Update: 1Q15 Review and 2Q15 Preview
The first quarter of 2015 has come to a close and investors are faced with an ever changing global economic landscape. With a change in market leadership as the MSCI Emerging Markets (EM) Index outperformed the S&P 500 Index, the EGA investment team believes there is an opportunity for investors to be selective within EM and focus on those areas of potential growth....
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