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Russell Investments is getting new owners. An investor consortium led by B Capital, a global multi-stage investment firm, has agreed to acquire the asset manager from TA Associates and Reverence Capital Partners.
After years of disappointment, the tide could finally turn in favor of emerging markets ETFs and stocks. Early 2023 price action confirms a step is being taken in the right direction as the widely followed MSCI Emerging Markets Index is higher by 10.11%.
Entering 2023, there were expectations that this could finally be the year that emerging markets equities give investors something to cheer about following a lengthy run of laggard status.
Emerging markets equities endured another year in 2022 as the economy in China slumped amid harsh coronavirus restrictions and as major developed market central banks raised interest rates.
This year brought more disappointment when it comes to emerging markets equities and the related exchange traded funds, extending a now-lengthy run of developing economy stocks providing investors with essentially nothing to cheer about. Predictably, China was a major culprit in the 2022 dud status of emerging markets stocks.
Environmental, social, and governance (ESG) investing is under increasing scrutiny this year as regulators clamp down on greenwashing and as some politicians target the investing style, asserting that the asset managers behind it are politically motivated. Even with those controversies, a majority of financial professionals back this methodology and see long-term relevance.
Owing to the increasing popularity of exchange traded funds such as the SPDR Bloomberg SASB Corporate Bond ESG Select ETF (RBND) and the SPDR MSCI USA Gender Diversity ETF (SHE), among others, demand is soaring for ESG indexes. Data confirm the rapid growth of this burgeoning index segment.
Investors long frustrated by the volatility and low quality associated with some emerging markets equities have options for revisiting the asset class, and environmental, social, and governance (ESG) virtues could set the stage for better long-term outcomes. Some exchange traded funds are geared specifically to meet this demand.