The Emerging Markets Cycle

Here’s a fascinating chart. This shows the main Emerging Markets ETF (EEM) divided by the S&P 500.

As you can see, it goes in long cycles. From 1999 to 2010, EEM beat the market regularly (except during the financial crisis).

Since 2010, the U.S. market has been the champ. The S&P 500 has doubled while EEM hasn’t gained at all.

Has the cycle turned? I can’t say for certain, but EEM has started to perk up against the overall market. If it’s a new trend, I think it could last several years.

Posted by on April 4th, 2017 at 1:00 pm


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