Hermes' Greenberg banking on EM 'normality' trade

Added 24th April 2017

Top-performing emerging market fund manager Gary Greenberg is banking on a “return to normality” in developing markets.

Hermes' Greenberg banking on EM 'normality' trade

Greenberg, who is Hermes Investment Management's emerging markets (EM) head, said the markets would make progress in future months in spite of signs the commodities boom is ending.

"Resource stocks account for only 18% of EMs, and resource-exporting countries only 42%," he said.

"This means that the outlook for EMs is more likely to be decided by other sectors."

Greenberg has managed Hermes' Global Emerging Markets fund since July 2011.

In the past five years the fund has gained 76% according to FE, significantly higher than its FE Equity - Emerging Markets average return of 25%.

The manager has been adding to his holdings in commodity exporters like Chile, Peru, Argentina and South Africa, even though he admits the latter move “might be totally stupid.”

Instead of commodities stocks, he’s choosing to invest in consumer discretionary companies and financials - focusing on “companies that benefit from rising standards of living and a return to normalisation".

“We continue to do that because we see commodities as being supported - not accelerating, but supported," he added.

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Kristen McGachey

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Kristen joined Last Word Media and the world of financial journalism in April 2016, leaving behind a career in a legal publishing firm as a senior researcher turned assistant editor.

This native Angelino initially moved to the UK in 2008 to complete her undergraduate studies at the University of Nottingham. She subsequently obtained a Masters degree in Philosophy with Literature from the University of Warwick.

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