So many great emerging markets presentations, so little time to blog about them.
Below you’ll find quotes or paraphrases of opinions voiced by speakers at the CFA Institute’s “Investing in Emerging Markets” conference held in Boston on October 19. If these snippets pique your interest, watch the CFA Institute website for podcasts or other records of selected presentations. Also see my recent blog posts, “Bubble?–Emerging markets scrutinized by CFA Institute conference,” “ISI’s Straszheim: China’s interest rate hike is ‘tapping the brakes’,” and “Cautious optimism on emerging market stocks from SSgA’s Hoguet.”
Paulo Vieira da Cunha, Tandem Global partners
- There is no decoupling. Two-thirds of global consumption and trade is in the advanced economies.
- There are lots of interesting plays in Brazil today, if you are careful.
- It’s very clear the Brazilian economy is overheated.
- China was a big factor in Brazil’s post-2008 recovery.
Kristen Forbes, MIT Sloan School of Management
- There are few options for emerging market countries to control the impact of capital inflows.
- Experts disagree about whether emerging market countries should impose temporary taxes on capital inflows.
- Academic literature says capital controls have little impact, especially long-term. At best, they can shift inflows to safer composition.
Sivaprakasam Sivakumar, Argonaut Global Capital
- The best opportunities in India are investing in first-generation entrepreneurs. Look for the next Infosys.
Tina Vandersteel, Grantham, May, Van Otterloo & Company
- When you invest in local emerging market debt, you face the “roach motel risk” of “you can check in, but you can’t check out.” Sometimes currencies can’t be converted.
- “You are picking up pennies in front of the train” when you invest in certain kinds of emerging market debt.
- Invest in emerging market debt for value and diversification, not for “safety,” betting against the U.S. dollar, or an inflation hedge.
Cliff Quisenberry, Caravan Capital Management
- There is a significant different between frontier countries in the index and the other frontier countries.
- Country selection is more important in frontier markets than in emerging markets.
AlisonAdams, Alison Adams Research
- Emerging markets’ share of global market capitalization could overtake developed markets’ share by 2030, according to Goldman Sachs.
- Most emerging market governments are reasonably market-friendly.
- Extreme events can present buying opportunities, as with the Mumbai attacks in India in 2008.