PA Video Insight: Emerging markets a case of flows not indicating smart investing

Added 21st October 2016

Alongside the return to form of emerging market indices fund flows have followed suit and poured into passive funds, yet market inefficiencies mean trackers and index huggers are going to be more prone to greater volatility

The recent increase of inflows to passive emerging market funds seems to fly in the face of those who see these markets a hugely inefficient, suggesting an active approach is perhaps a more sensible one.

Don Smith, emerging market equities CIO at BNP Paribas Investment Partners, looks to maximise returns not only by taking an active approach but also by exploiting those inefficiencies further down the cap scale.

Here, he explains why less well-known, less researched smaller companies are better placed to benefit from market inefficiencies and are also more directly exposed to the longer-term trends of being domestic focussed and consumer oriented. 

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About Author

Gary Corcoran

Director

Portfolio Adviser & International Adviser

Gary Corcoran is the editorial director for Portfolio Adviser, International Adviser and Fund Selector Asia. He is also programme director and chairman for events hosted across the UK, South Africa, Middle East and Asia. Gary joined Last Word Media in August 2006 as the launch editor of Portfolio Adviser, having previously worked at Bacon & Woodrow, Legal & General, FT Business and MSM International.

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