
Invesco Developing Markets Equity Fund
A bull market in emerging market equities
This page should be read in conjunction with the investment risks below.
Looking for attractive investment opportunities in emerging markets?
We believe the opportunities for investors are likely to be plentiful in emerging markets. Europe faces numerous headwinds, while valuations in the US market currently seem, in our view, to ignore the challenges ahead.
However, valuations across emerging markets have become inordinately cheap and we are excited to uncover well-run companies even in the most stressed economies.
Learn more about the Invesco Developing Markets Equity Fund
Why Emerging Markets Equities?
01 Weakness in the US dollar
Emerging markets currencies are competitively priced and historically emerging markets stock markets have tended to perform better against a backdrop of a weakening US dollar.
02 The right cocktail
An environment of low interest rates and a weakening US dollar are likely to boost foreign capital flows and private investments towards non-US assets. That bodes well for emerging markets, which we think offer greater potential for growth as (non-China) emerging countries by and large are constrained by insufficient domestic savings to fund investments necessary to lift structural growth.
03 China
China now accounts for more than 40% of the MSCI Emerging Markets index. With more unicorns (privately held innovative start-ups valued at more than US$1 billion) going public, we believe that China’s share will continue to grow in size and importance.
04 Improving accessibility
With the massive changes in accessibility of Chinese companies (and relatively pedestrian real estate prices), we anticipate a significant shift in asset allocation towards equities, analogous to what we witnessed in the US in the 1980-90s when mutual funds democratised equity investing. And remember China has the largest savings pool in the world.
Seeking to outperform through active portfolio management
The team employs a bottom-up approach that seeks to identify exceptional companies that benefit from structural growth tailwinds, have sustainable competitive advantages and real options that manifest over time. For professional investors only
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