Developed Market Crash, Emerging Market Rally?

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by: Hedgeye
Summary

If developed markets crashed, could investors see a potential rally in emerging markets?

While it’s an unlikely scenario, it’s not without precedent explains Hedgeye Macro analyst Darius Dale in the video below.

"There is historical precedent for EM to diverge from developed markets, particularly when the Fed is getting aggressive from an easing perspective."

If developed markets crashed, could investors see a potential rally in emerging markets?

While it's an unlikely scenario, it's not without precedent explains Hedgeye Macro analyst Darius Dale in the video below.

"You could go back to 2002 when China was first taking off and dragging EM up with it," Dale explains.

"You could go to the first half of 2008, which is obviously not a great example for what happened after. And then finally 2011. So, there is historical precedent for EM to diverge from developed markets, particularly when the Fed is getting aggressive from an easing perspective."

Watch the full video above for more.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.