The Case for Active Management
The Templeton Emerging Markets Group believe that being present in these local markets and building relationships with local business leaders provides them with an edge, helping them to differentiate the winners from the losers and specifically to be able to assess risks better through the kind of local perspective which gives us a very good understanding of where both the upsides and the risks lie within those business models.
We actively control our weightings to any one country, sector or market to avoid the concentration risks inherent in a market weighted index. For example, the top three countries in MSCI Emerging Markets Index account for more than half of the Index performance.
A Word about Risk
TEMIT is exposed to a number of risks, including but not limited to:
Investment and Market Risks, Currency Risks, Political Risks, Counterparty (Credit) Risks, Regulatory Risks.
In emerging markets, the risks can be greater than in developed markets. Emerging Markets can sometimes experience periods of political, economic and currency instability, as well as changing investor sentiment that cause investments to fall in value, sometimes sharply.
Past performance is not a guide to future performance. The value of shares in the Templeton Emerging Markets Investment Trust, and any income from them can go down as well as up and your clients may not get back the amount you invested.
For full details of all of the risks involved in investing in the Templeton Emerging Markets Investment Trust please read the Annual Report (click here).