Emerging Market Funds

WHAT ARE EMERGING MARKET FUNDS?

Emerging market funds offer investors exposure to, in our view, some of the most compelling opportunities outside of the United States. These investments are available via mutual funds or ETFs, and in various traditional asset classes including equity and fixed income. Investors also have the option of focusing on a single country or a more diversified portfolio across emerging countries.

The term “emerging markets” can be interpreted several ways, but it generally refers to the 20+ countries that are part of the MSCI Emerging Market index1, which includes China, India, South Korea, Brazil, Russia, Taiwan and South Africa.

1. Source: MSCI

TYPES OF EMERGING MARKET FUNDS

There are a number of different types of emerging market funds, each with their own characteristics and level of risk.

Equity

Equity funds typically invest primarily in stocks in order to seek long-term capital appreciation and/or income. These funds may focus on companies in individual emerging market countries or regions or may have a specific investment style, such as investing in value or growth stocks.

Bond

Bonds are debt instruments issued by various public and private entities in emerging markets, including sovereign governments, international agencies, state and local authorities, and private corporations.

Blend

Blend funds, also called “hybrid funds,” typically invest in a mix of value and growth stocks as a means of providing diversification between the two investment styles.

ETF

An ETF, or Exchange Traded Fund, is a basket of securities such as stocks and/or bonds that are held in a single fund that is bought or sold on an exchange. Over the last 20 years, ETFs have become popular primarily because they provide transparent, affordable access to a wide array of investment strategies. Emerging market ETFs focus on individual countries, entire regions, or the global market.

WHY INVEST IN EMERGING MARKETS?

Investing in emerging markets offers many potential benefits, including the ability to participate in the projected growth opportunities in some of the world’s fastest growing economies while taking advantage of greater global diversification.

Diversification

Franklin Templeton emerging market funds are invested in a wide variety of industries, countries, and regions, which has the potential to reduce portfolio volatility. Many of these regions don’t correlate with each other or with developed markets, potentially offering further diversification protection.

Opportunity

Investing in emerging markets has the potential to improve your portfolio's long-term returns compared to investing only in developed markets. You can see in the GDP chart, emerging markets are currently projected to grow at a faster pace than developed markets.

Projected GDP Growth Rate (2020e to 2024e)2

Emerging Markets    Developed Markets

2. Source: Growth rate projections sourced from Bloomberg and International Monetary Fund, World Economic Outlook Database, as of April 2019.

There is no assurance that any projection, estimate or forecast will be realized.

Valuation

Unlike companies in developed markets, where equity valuations are well established and generally transparent, the value of companies in emerging markets is often opaque and subjective. As a result, companies in emerging markets may be undervalued compared to their developed market counterparts.

This creates opportunities for experienced active fund managers employing proprietary fundamental analysis to identify undervalued and mispriced stocks and bonds ignored or overlooked by other investors. Our investment professionals seek companies with sustainable earnings power at a discount to their intrinsic worth and compelling opportunities before they reach broader market recognition.

Why Choose Franklin Templeton?

Franklin Templeton is a pioneer in emerging market investing with more than 30 years of experience navigating through multiple market cycles. Our experienced team provides extensive local research, integrated with cross-border global insights.


30+
Years navigating
market cycles

80+
Investment
professionals3

16
Countries

$33bn 
In assets under
management

globe

Global
  • Global Emerging
    Markets
  • Emerging Markets
    Small Cap
  • Frontier
map tab

Regional
  • Asia
  • Asia Small Cap
  • BRIC (Brazil, Russia,
    India and China)
  • Latin America
  • MENA (Middle East
    and North Africa)
flag

Country
  • Brazil
  • China
  • India
  • Malaysia
directions

Private/ Hybrid
Equity

  • Global and Regional
    Private Equity Strategies (PE)
  • Global Impact PE Strategy
  • Shariah PE Strategy
  • Romania Equity
  • Turkey Equity

Representative list of available strategies. Not intended to be a complete list of available strategies. As of September 30, 2019.

3. Investment professionals include research analysts, portfolio managers, directors and CIO.

OUR EMERGING MARKET FUNDS

We offer a wide range of emerging market investments, including:


17 total products,
(6 Funds & 11 ETFS)


7 global emerging
market funds


10 regional or
single country ETFs

Featured products:

The fund seeks long-term capital appreciation by investing, under normal market conditions, at least 80% of its net assets in emerging country equity securities.

Learn More

View our lineup of Emerging
Market Mutual Funds

The fund seeks to provide investment results that closely correspond, before fees and expenses, to the performance of its corresponding underlying benchmark, the LibertyQ Emerging Markets Index.

Learn More

View our lineup of Emerging
Market ETFs

HOW DO I BUY EMERGING MARKET FUNDS?

Discuss with Your Financial Advisor

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Insights

Stay up to date on the latest emerging market investment topics and themes with insights from Franklin Templeton’s talented team of investment professionals.

Access Emerging Market Insights