Goldman Sachs: Cut your emerging markets exposure by a third

Kenster1_GlobalValue

Goldman Sachs has a clear warning for investors: Emerging markets will continue to disappoint.

In a December report, the bank's investment management division predicted "the strong possibility of significant underperformance and heightened volatility over the next five to 10 years."

http://www.cnbc.com/id/101289746

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"Going bearish on emerging markets may have become the consensus call, but some fund managers are quietly turning more positive, citing attractive valuations."

http://www.cnbc.com/id/101296623

finder

Look at a similar report from Morgan Stanley of June 2013:

http://www.btinvest.com.sg/system/assets/15223/EmergingMarkets_BP061313.pdf

Kenster1_GlobalValue

Reply to @finder: You're right - it does.

mcmarasco

Does this mean it's time to buy????

I do not plan to reduce my EM holdings; I still believe they provide good long-term growth and some diversification.

Any thoughts????

scott

Reply to @mcmarasco: I think it all depends on your time frame. If you have a long-term time frame, then I think by all means look at EM. I do think that some EM will do better than others - Brazil, unfortunately, seems like a mess, sadly. See: http://www.globalpost.com/dispatch/news/regions/americas/brazil/131007/sao-paulo-household-debt-credit-card-brazilian-economy

I am adding a little here-and-there to a couple of long-term individual Asian names, a little to an Asian EM fund and looking for a couple of new ideas maybe for early next year.