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From Komfie Manalo, Opalesque Asia:

In Part One of this series, Laurence Taylor, Portfolio Specialist for the Global Large-Cap Equity Fund at T.Rowe Price discussed how emerging markets would do much of the pulling to lift up the global economy.

In Part Two here, Taylor explains the role emerging markets will play in shaping the global economy:

Since 2002, emerging markets (EMs) MSCI ACWI weighting has increased 250% because of strong relative returns and broadened investible opportunity. EM accounted for more than 14% of MSCI ACWI as at September 2010. The figure could rise up to 31% of the total global equity markets if you do not adjust for free float, Taylor says.

Indeed, EMs projected changes in their global significance are expected to be even more dramatic over the next 10 to 20 years. Estimates suggest the EM share of total world market cap will continue its rapid rise: to 44% by 2020 and over 50% by 2030.

Taylor told Opalesque, “The strengthening of fundamentals underpinning emerging world economies are not recognized by all as yet, but we would expect that exposure to these markets will increase as growth is sought in a world where growth remains scarce. This should be a long term tail wind for markets.”

Where exposure has lagged the evolution of the emerging world......................

To view our full article Click here