Emerging markets (EMs), which posted their worst annual performance in 2022 since the global financial crisis, may show a trend reversal in 2023 as historically they have shown a tendency to recover first in a recessionary environment. They are therefore often touted as an early-cycle asset class.
In each of the four US market recessions since 1990, EMs were the first to recover demonstrating a significant jump from trough to peak. For instance, EM equities gained 33% in the three months after global equities hit a bottom in the last week of March 2020.
Fidelity Emerging Markets Limited (LON:FEML) is an investment trust that aims to achieve long-term capital growth from an actively managed portfolio made up primarily of securities and financial instruments providing exposure to emerging markets companies, both listed and unlisted.
