Managers selective on EM in event of Fed policy mistake

Instead of investing in the whole complex, managers prefer emerging economies with a strong balance sheet

Emerging markets
Emerging strength: Argentina, India, Indonesia and Mexico are favourites as they tend to perform relatively strongly in difficult environments

Money managers are eyeing emerging markets (EM) with stronger balance sheets as they could be less reactive to a potential policy mistake by the Federal Reserve, and also better suited to playing the growth differential story that exists with their more developed peers.

Gordian Kemen, a global head of emerging markets fixed-income strategy at Morgan Stanley, who spoke on the emerging markets panel at the 14th annual FX Week USA conference on July 12, said he expects emerging markets growth to o

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