The Emerging Markets Panic Is Overdone (EEM)

Share This Article
July 27, 2018 6:20am NYSE:EEM

From Knowledge Leaders Capital: Recently, fears of a slowdown in global growth brought on by a trade war have led to turbulence in cyclical assets.

The US Dollar has risen while commodities and emerging markets have struggled. The Chinese Yuan has depreciated significantly, recalling fears of the 2014-2016 industrial recession. This quarter, we examine the outlook for economic growth and inflation, and how a trade war may impact the economic environment. From there, we discuss asset allocation through the lens of this economic environment, including:

  • A 4-quadrant look at the basic economic backdrop;
  • Why we are underweight both stocks and bonds;
  • Why we are overweight commodity-related cyclical assets;
  • Why now is not the US Dollar’s time to shine; and
  • Why the emerging markets panic is overdone.

Finally, we wrap up with our analysis of the global energy sector and why this is our largest sector overweight.

Download the slides here: What We Know, What We Think & What We Are Unsure Of

Sign up for reports from Knowledge Leaders Capital

The iShares MSCI Emerging Markets Indx ETF (EEM) rose $0.21 (+0.47%) in premarket trading Friday. Year-to-date, EEM has declined -5.50%, versus a 6.60% rise in the benchmark S&P 500 index during the same period.

EEM currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #3 of 87 ETFs in the Emerging Markets Equities ETFs category.

This article is brought to you courtesy of Knowledge Leaders Capital.

Read Next

Get Free Updates

Join over 50,000 investors who get the latest news from!

Most Popular

From Our Partners

Explore More from

Free Daily Newsletter

Get daily ETF insights from our market experts. Never miss another important market development again! respects your privacy.

Best ETFs

We've rated and ranked nearly 2,000 ETFs and ETNs using our proprietary SMART Grade system.

View Top Rated ETFs

Best Categories

We've ranked dozens of ETF categories based on relative performance.

Best ETF Categories