By Gustavo Medeiros, Ben Underhill
The Emerging View

The case for emerging market small cap equities

EM small caps are assumed to be the risky cousin of US small caps. The data says otherwise: nearly nine in ten are profitable, on half the forward multiple of the Russell 2000. We make the case for the asset class.

Subscribe to our insights

Subscribe and get notified as soon as we publish our content

The latest insights from our categories

Weekly investor research

Oil relief welcome before Wednesday’s FOMC

After 13 consecutive nights of strikes, the US paused its attack on Iran over the weekend, welcome relief ahead of Wednesday's FOMC. Elsewhere, Samsung and SK Hynix signed USD 950bn of US supply deals and Bank Indonesia's governor resigned.
Weekly investor research

The arrival of Kimi K3 tests investors’ faith in Jevons’ Paradox

Chinese open-weight model Kimi K3 raises questions over AI lab monetisation, testing investors’ faith in Jevons’ Paradox. The Korean memory stock unwind extends, US CPI turns negative and the Bank of Korea hikes for the first time in three years.

Latest Insights

Weekly investor research

Elections still dominate the macro calendar

A landslide victory in Mexico led to higher market volatility as it raised constitutional risks, while coalition governments in South Africa and India led to a more muted market response. The IMF struck deals with Zambia, Ukraine, and Ecuador.
Weekly investor research

Elections in South Africa, India, and Mexico dominate the agenda.

FOMC minutes’ more hawkish tone led to a re-pricing of rate cut odds in September. Flash PMIs showed stronger service sector, booming India. Taiwan geopolitical ‘noise’ increased last week on the new government inauguration. Israel’s offensive in Rafah...
The Emerging View

Middle East and Global Geopolitics: When it rains, it pours.

The heaviest rainfall in 75 years in Dubai is an unlikely analogy to the current state of geopolitical affairs in the Middle East. A few years ago, the prospect of a direct conflict between Iran and Israel would have brought chills to analysts’ spines.
Weekly investor research

Spotting stagflation

US economic growth has surprised to the downside, inflation to the upside. A helicopter crash killed Iranian President Raisi. Israel’s Netanyahu faced more pressure from his cabinet. The US announced 100% tariffs on imports of Chinese electric vehicles.
Market Commentary

Rooting for change: Investor engagement and EM deforestation risk

The pivotal role of forest preservation in the battle against climate change is well understood. Forests provide a crucial carbon sink, the destruction of which will further accelerate global warming. Indeed, an estimated 15% of global carbon...
Live at the Sub-ICs

EM’s role in the AI revolution: disruptor or disrupted?

As Artificial Intelligence (AI) evolves, it has the potential to be transformational for Emerging Markets (EM) through the advancement of economic development, by disrupting industries and, in some EM companies’ cases, by leading the global AI...
Weekly investor research

China focuses on domestic reforms and overseas cooperation

Hawkish holds/cuts in EM contrasted with dovish holds/cuts in DM. US economic growth softened in recent weeks, while EM growth remained resilient. The US is considering quadrupling tariffs on Chinese renewable technology imports. China’s Xi visited...
Weekly investor research

Two birds with one stone?: EM small caps

Short-term bond yields have a cap as rate hikes in the US are “unlikely”, supporting asset prices. A less hawkish message from US Federal Reserve (Fed) Chair Jerome Powell drove stocks and bond prices higher last week. The US labour market is softening...
Weekly investor research

Chinese stocks breaking out as US stocks wobble

The JPY posted high volatility overnight as over-extended short JPY positions remain in place. Bank Indonesia hiked policy rates by 25bps in a surprise move, signalling dissatisfaction with the USD strength derived from JPY weakness. EU-China relations...
Weekly investor research

Monetary policy divergence amid geopolitical volatility

The Fed walked away from cuts early in the summer, while the ECB remained in that camp. The US announced it would re-impose sanctions on Venezuela, but in a weaker format, a reflection of the current political realities. The US House of Representatives...
Weekly investor research

Iran launched an unprecedented strike against Israel

Israel reportedly suffered minimal damages from the telegraphed air strike from Iran. While the attack has raised the stakes in the Middle East, Iran signalled a willingness to de-escalate, a stance favoured by the United States (US).
Weekly investor research

Policy direction unchanged post local elections in Türkiye

Monetary policy turned more cautious across the US and several Emerging Market (EM) countries, improving the risk-reward dynamics for bonds. Oil and gold prices increased as geopolitical risks remained elevated. EM manufacturing sentiment improved...