MSCI: Time to Rethink Emerging-Market Allocations?

Over the last five years, the risk and return profile of emerging markets has started to resemble that of developed markets (below chart). That leaves many large asset owners to ask how to structure mandates to take advantage of the variation in the behavior of emerging markets.

THE RISK/RETURN PROFILE OF EMERGING MARKETS HAS BECOME MORE LIKE THAT OF DEVELOPED MARKETS

Institutional investors face at least three choices in their allocations to emerging markets. They can allocate to an

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