"Are emerging market (EM) stocks cheap by historical standards? The valuation gap between developed market (DM) and EM equities might suggest so.
The chart below shows that the valuation premium for DM stocks over EM peers is at its highest since June 30 2004, according to data from Unigestion, an investment management company. It measured valuations using price-to-book ratios, which are calculated by dividing a stock’s price by the latest quarter’s book value per share.
“The emerging markets are underperforming,” said Bruno Taillardat, executive director at Unigestion. “What we are seeing is that there is a discount in EM valuations right now. It is such a big gap, we think it will converge.”
'via Blog this'
No comments:
Post a Comment