The vast majority (88%) of respondents report that their clients have exposure to emerging markets in their portfolios, whether to take advantage of increased opportunities in fast-growing economies or as a way of diversifying core holdings beyond the heavily traded U.S. equity market.
While emerging markets have clearly become a common component of client portfolios, they still make up a relatively small portion of a typical portfolio.
On average, exposures to emerging market equities make up only 10% of a typical portfolio. Even that figure doesn’t quite tell the whole story, however. The majority of client portfolios (61%) maintain an emerging market equity allocation of less than 10%. There are reasons to believe this niche status for emerging markets securities may be poised to change.