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Emerging markets have contributed more than 50% of the global GDP growth over the last 20 years, a significant accomplishment, given the doubling of global GDP during this period. This contribution is forecast to increase over the next few decades as a result of superior economic growth from emerging market nations. India and China’s emergence as global economic giants will in turn produce growth for…
Leading finance officials in India remain confident that the economy there will be largely unscathed by recent turmoil in global financial markets. Fundamentally, the country is on firm footing with both production and consumption at elevated levels compared to its peers and inflation under control. Also, India’s SENSEX is still up 4.71% YTD despite outflows, exhibiting much resilience¹.
Foreign Direct Investment (FDI) in China picked up substantially last month to reach a year-over-year pace of 22%, according to the Ministry of Commerce. This number dwarfs figures recorded for both May and June, which came in at 7.8% and 5.2%, respectively. The August data is also a strong indicator that fears of a full-fledged slowdown in the world’s second largest economy may be overdone.
Since his election victory in May 2014, Narenda Modi has been true to his words to urbanize India over the next decade. Under his leadership, anti-business regulations have been relaxed, opening the door to foreign companies such as Samsung and Airbus.
Despite persistent talks of a slowdown, latest figures from the World Economic Forum show China’s voracious appetite for commodities is still very much intact. Metals used in construction, such as aluminum and copper, came in at the top of the list, where China’s share of global consumption stood at 54% and 48%, respectively.
Worries of a hard landing in China seem to be unfounded. Admittedly, gone are the days when the economy would post blockbuster, double-digit GDP figures, but growth ranging from 5-6% is still enviable in the current global climate as the consumer story there continues to develop.
The Canadian equity market is highly concentrated in three sectors - and is relatively small compared to other markets. Yet investors choose to maintain a “home country bias,” foregoing the opportunity to diversify their investments and enhance their returns. The case for global investing is two-fold: diversification and greater opportunities. In the case of diversification, the Canadian stock market accounts for just over 3% of total…
Canadian investors have historically maintained a home country bias on the belief that domestic companies will perform better than foreign companies and that foreign companies are riskier than domestic companies. The home country bias is particularly evident when it comes to emerging markets, which have not only outperformed developed markets over the long-term but are also less risky. Arguably, the home country bias is demonstrated…
Taking a balanced approach to investing in emerging markets is critical to getting the highest possible risk-adjusted returns, while minimizing risk.
China's services industry's rise in the first half of 2015 displayed in an infographic in the China Daily. Design by Xing Zhonghao. Data Source: National Bureau of Statistics
In its effort to shore up its slowing economy and take steps to facilitate the inclusion of the yuan in the IMF’s basket of reserve currencies (Special Drawing Rights or SDRs), China has effectively devalued its currency twice in two day. On Tuesday, China surprised the markets by announcing a 2% devaluation of the yuan. Then on Wednesday, the People's Bank of China (PBOC) set…
When it comes to investing in emerging markets (EM), an active management strategy has many distinct advantages over a passive management strategy typically used by index-based investments. Arguably, the debate surrounding active versus passive management – whether in emerging or developed markets (DM) - amounts to no more than a zero sum game, as either strategy has its own merits and pitfalls; and winners and…

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