Renaissance manager keen on Russia and Turkey

Mon Jul 16, 2012

The clear distinctions between emerging and developed markets are becoming increasingly redundant, according to Robert Holmes from Renaissance Asset Management.

The possibility that Greece could return to emerging market status, according to MSCI classifications, is an indication that the definitions have become increasing complex, says the portfolio manager for Renaissance Eastern European Allocation Fund.

He explains: "The differences between emerging and developed markets used to be much clearer especially in the 1990s and related more to simple metrics such as GDP per capita.

"Having this simplistic binary definition of emerging and developing markets has become increasingly redundant. But I wouldn’t say the markets are converging.

"If you look at CDS spreads, which is an indicator of sovereign default probabilities, many emerging market spreads have decreased whilst developed markets have increased.

"For example, Poland, Russia and Turkey spreads are now not only much lower than the European periphery but are also...

ISSN: 2151-1845 / CDC10004H


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