- Emerging markets have disappointed recently but could still be attractive
- They suit experienced investors with a long time horizon
- We look at the right level of allocation and some fund ideas
Emerging markets are often hailed as a region with the potential for superior growth. If you want to opt for an aggressive investment strategy, taking more risk in the hope of bagging greater returns in the long term, one of the options is dipping your toes in the more volatile stocks available beyond the developed world.
However emerging market equities are not for everyone, and superior performance is far from a given or even a reality in recent years. In the decade to 22 November, the MSCI Emerging Markets index returned 72 per cent in sterling terms, while the MSCI World, which only includes developed markets, was up 223 per cent. The gap has widened in recent years, especially after the Covid-19 pandemic.