Welcome to the World of Submerging Markets

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Investing in growth is a no-brainer. And so the MSCI Emerging Markets index — which started in 1988 — was a natural way to funnel interest (assets) into the burgeoning companies of developing countries. The makeup of this Morgan Stanley index has changed since, increasing to 25 from the original eight, with lots of countries (and the stocks of their leading companies) dropping in and out. In a blazing run from 2003 to 2007, the index out-performed the S&P 500 on an annual return basis. The record’s been spotty since, with the global financial meltdown and the Covid pandemic playing their parts. As Shuli Ren says, the benchmark index “has not outperformed its US counterpart [in] consecutive years” since 2010.