Sunday, October 2, 2016

Emerging markets have outperformed developed markets 61% of the time

Deal Street Asia:

Emerging markets have outperformed developed markets 61 per cent of the time in the last 28 years, which is why there is a tremendous growth in the investor interest in those countries, said  Mark Mobius, iconic investor and Executive Chairman, Templeton Emerging Markets Group, Franklin Templeton Investments, at Asia PE-VC Conference at Singapore today.

“Except for the last three years, out of the 28 years, about 61% of the time emerging markets have out performed the developed markets, so in the long term it’s not too bad,” Mobius said in his key note address. “One of the reasons why there is growing interest in the emerging markets is that they are out performing the developed markets including the US,” he added.

This is an interesting stat. This makes sense because the emerging market economies are typically growing faster than developed markets. Economic growth does not typically correlate to stock price increases in the short term. However in the long term economic growth does correlate with stock prices.

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