The Intelligence Report – 23 October 2017

23 Oct 2017

  • Turkish delight: Supportive factors could make the lira a worthwhile prospect – Explains the extraordinary performance of Turkish assets so far in 2017 in terms of a host of local and global equity-supportive factors
  • Don’t buy the index: EM debt is more alpha-rich than at any time in the past four years – Looks at the prospects for emerging market local debt in 2018, following a rally this year
  • China: Preparing for the next leg up – Explores a range of reasons to continue to be positive on Chinese equities, despite this year’s sharp rally

Regular readers of the Intelligence Report will know the importance we place on emerging markets, not just as a rich source of diversifying alpha but also as a source of information to help make better decisions about developed markets. Given the size of emerging economies and the interconnectedness of the global economy, we think that it is increasingly difficult to make good decisions about developed markets without having a deep understanding of emerging markets.

In this week’s Intelligence Report, we return to emerging markets. In the first article, Pinar Uğuroğlu explains the extraordinary performance of Turkish assets so far in 2017 in terms of a host of local and global equity-supportive factors. In the second article, Cristiana de Alessi looks at the prospects for EM local debt in 2018, following a rally this year which has brought local yields, as exemplified by JPMorgan GBI-EM yields to their lowest level since the taper tantrum. Lastly, Caroline Yu Maurer finds a range of reasons to continue to be positive on Chinese equities, despite this year’s sharp rally. Three separate EM stories linked by a common theme – the belief that this year’s strong performance can be sustained.

Happy reading!

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