According to the publication, investors have also pointed to the low valuations that some emerging market assets have as an advantage, especially at a time when many consider US stocks to be overvalued.
On 27 January, the MSCI Emerging Markets index traded at 16 times expected earnings (over the next 12 months), according to
Bloomberg. In comparison, the S&P 500 had a PE ratio of 22 times on the same day.
Sustainable gains across the board
The iShares MSCI Emerging Markets ETF [EEM], which is considered to offer the broadest exposure to emerging markets, has gained 11.06% in 2021 so far (through 11 February’s close). The iShares ESG Aware MSCI EM ETF [ESGE], which focuses on more sustainable companies, has gained 11.23% in the same period, while the Goldman Sachs ActiveBeta Emerging Markets Equity ETF [GEM] has grown 9.27%.