The MSCI Emerging Markets Index is one of the most popular indices that track emerging markets. The index gives exposure to represents 846 large and mid cap stocks from 24 emerging markets. Many products such as ETFs and mutual funds use this index as a benchmark. For example, the iShares MSCI Emerging Markets ETF(EEM) which has over …
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The S&P 500 Index is the benchmark index of the US equity market. Billions of dollars are invested in various products tracking the index. The sector breakdown of the S&P 500 is shown below: Click to enlarge Source: S&P Indices The tech sector dominates the US equity market. No other country in the world can match …
US stocks continue to remain expensive relative to other markets according to a recent article posted at Schroders. Going into 2018, US equities were expensive based on multiple metrics. So even after the decline and volatility in the first quarter of this year, valuations are not in favor of American stocks. Click to enlarge Source: Which …
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Valuations remain elevated for US stocks. For instance, the S&P 500’s forward P/E rose above 20 going into 2018. Since then volatile and declining stock prices have pushed the ratio down to below 17. The chart below shows the S&P 500 Forward P/E Ratio since April of 2006: Click to enlarge Source: Focus on Fundamentals, Legg …
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One of the easiest and simplest diversification strategies is to diversify across borders.Since the performance of equity markets varies across countries in any given year, an investor can boost their returns by spreading their assets across many countries. For example, emerging markets that are highly dependent on commodity exports perform well when commodity markets boom. …