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You must read this before proceeding, as it explains both the legal and regulatory restrictions which apply to the information contained and investment products referred to within this Website.
Portfolio Holdings for Non-US Funds/Non-US Advisers - From time to time Franklin Templeton Resources Inc (FRI) and its subsidiaries, partnerships, joint ventures and related and affiliated business entities (“FTI”) may provide you with a partial listing of portfolio securities including but not limited to top contributors and detractors to portfolio performance owned by one or more non-US domiciled funds that are registered or passported with local regulatory authorities and are sponsored by FTI (each a “Fund” and together “Funds”) and any such additional information relating to the Fund(s) that may not otherwise be publicly disseminated. Such listing of portfolio securities and any other non-public information is subject to the following terms and conditions below and is herein referred to as “Holdings Information”.
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According to research by Templeton Emerging Markets Investment Trust investors could be missing out on the emerging market opportunities because of misconceptions about emerging markets.
Key misconceptions included:
Read on to find out if any of these misconceptions might be affecting the way you think about emerging market investing.
MISPERCEPTION
Emerging markets are risky
REALITY
Adding emerging markets exposure can potentially diversify a portfolio and reduce risks
77% of respondents think that adding emerging market exposure to an investment portfolio increases risk
"Whilst many investors may dismiss emerging markets as too risky, the rewards they can deliver over time mean they should not be overlooked. In the current low-growth, low-yield environment, emerging markets provide investors with access to innovative, fast growing companies trading at attractive valuations."
MISPERCEPTION
Volatility is not beneficial for investment portfolios
REALITY
Volatility provides opportunity for active managers
50% of investors agree that volatility is beneficial for portfolios
However, 29% do not think it is good for investment portfolios
"Despite the higher growth rates of emerging markets compared to developed-market economies, valuations generally appear much more reasonable. You can invest in many emerging market companies at a price that is a significant discount to an equivalent business in the developed world. And, because of their low correlation with each other and with developed market stocks, they offer investors better diversification."
MISPERCEPTION
Investors know what an emerging market is
REALITY
Investors can only identify famous emerging markets
Research shows investors can easily identify some of the most famous markets as emerging whilst there is some confusion over less famous markets
Learn more in our infographic - Widespread confusion about emerging markets could be costing UK investors
MISPERCEPTION
Emerging markets are all about commodities
REALITY
Information Technology and Financial Services now form the biggest part of the MSCI Emerging Markets index
Over half 56% of investors still associate commodities with emerging markets
"Emerging markets are no longer driven by commodities; the business models that focused on infrastructure, telecommunications, or commodity-related businesses have gone. Instead, the technology sector in emerging markets is providing us with many interesting opportunities and we think it’s a very exciting time for investors in this space."
MISPERCEPTION
Emerging markets do not drive innovation
REALITY
Over half of global patent applications are now registered in emerging markets
Over half 53% of investors believe the largest number of global patents are registered in the US
"Emerging markets are no longer driven by commodities; the business models that focused on infrastructure, telecommunications, or commodity-related businesses have gone. Instead, the technology sector in emerging markets is providing us with many interesting opportunities and we think it’s a very exciting time for investors in this space."
Source: research conducted by Opinium Plc on behalf of Templeton Emerging Markets Investment Trust between 31st July to 4th August 2017.
This document is intended to be of general interest only and does not constitute legal or tax advice nor is it an offer for shares or invitation to apply for shares of the Franklin Templeton Funds (a UK-domiciled OEIC), (the “Fund”) or Templeton Emerging Markets Investment Trust (“TEMIT”). Nothing in this document should be construed as investment advice.
The value of shares in, or the income received from, the Fund can go down as well as up, and investors may not get back the full amount invested. Past performance is not an indicator or a guarantee of future performance.
Issued by Franklin Templeton Investment Management Limited, Cannon Place, 78 Cannon Street, London EC4N 6HL. Authorised and regulated by the Financial Conduct Authority. Telephone: 0800 313 4049, Email: ftisalessupport@franklintempleton.co.uk.