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3 Emerging-Markets Equity Funds That Have Handled Volatility Well

These stalwarts won’t avoid all of their asset class’ rough spots, but they can smooth them out.

Fears over trade wars, slowing growth in China, and rising U.S. interest rates have wreaked havoc on emerging-markets stocks. The diversified emerging-markets Morningstar Category was the worst nonsector or single-country fund peer group for the year to date and trailing 12 months through mid-October 2018.

This type of volatility still comes with the asset class. Emerging markets are different than they were when investors started using the term more than three decades ago. They are deeper, more liquid, and populated by more-mature global companies. The developing world, however, is still prone to social, political, and macroeconomic upheavals that can churn short-term equity returns. It still pays to have a steady hand at the helm of a proven process if you opt for an actively managed investment strategy.

Morningstar Analyst Ratings have long recognized this. Here's a look at how some of the funds that Morningstar has rated the longest in the group have negotiated recent and long-term volatility.


The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.

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