Sax Angle Partners owns EEM, iShares MSCI Emerging Market ETF. We prefer to invest in companies where management is buying but that information is not available in these markets and having just got back from China last month, I find it hard to ignore it completely. The Financial Times reported today that China became the world’s biggest trader in goods for the first time last year, overtaking the US for all of 2013 and finishing the year with record trade figures in December.
Ahead of the Crowd | THURSDAY, JANUARY 9, 2014
Emerging Market Stocks Are too Cheap to Ignore
By JACK HOUGH | MORE ARTICLES BY AUTHOR
Emerging market shares may rise 13% to 15% over the next five years, trouncing expected U.S. gains.
Slumping emerging-market stocks are now priced to return an average of 13% to 15% a year over the next five years. But soaring U.S. shares are priced to return just 2% to 4% over the same stretch. That’s according to Jason Hsu, chief investment officer at Research Affiliates, a Newport Beach, Calif. money manager with more than $150 billion linked to its strategies.
Over the past three years, U.S. shares have shined, returning 13.1% a year, according to index publisher MSCI. That compares with 6.4% for euro zone shares and a yearly loss of 5.3% for emerging markets. A popular explanation for the wide performance gap is that the U.S. economic recovery appears to be gaining strength, while growth is slowing in markets like China.
via Emerging Market Stocks Are too Cheap to Ignore – Barrons.com.