Even with the major U.S. indices near all-time highs, a growing number of investors and fund managers have a clear preference for emerging markets while shunning domestic equities. In today’s report I’ll make the case that, as with most overcrowded trades, investors’ bet that emerging markets will outperform in 2019 isn’t likely to pay off. Instead, the odds favor U.S. stocks outperforming their EM counterparts in the months ahead.
According to a widely discussed report from Bank of America Merrill Lynch, investment fund managers are still worried about the U.S.-China trade war and China’s slowing