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Coming of Asia
The traditional view is that developing markets will outpace mature ones over the long term , assuming investors are prepared for some volatility in between . Yet the performance of the MSCI Asia Pacific ex Japan index over the past decade has called this notion into question : total returns have been lacklustre , and it has delivered only around half the gains of the broader MSCI World index . However , Emma Wall , head of investment analysis and research at Hargreaves Lansdown , says that to be fair to Asia , everyone apart from the US has struggled to keep up with the global market .
“ The drivers of returns over that period have been very narrow ,” she explains . “ We have seen a small number of names , pretty much in a single sector – technology – drive the global equity market . “ The majority of these names happen to be listed in the US , meaning relative outperformance .” In addition , Wall notes that Asia ’ s dominant player , China , has had to cope with numerous countryspecific headwinds . “ The one-child policy has resulted in a country with demographics more akin to a developed nation , while a boom-bust property market and particularly strict pandemic policies have held back economic growth and investor sentiment ,” she continues . “ Then throw in four years of an anti-China US president in the form of Donald Trump for good measure .”
Ticking away Despite all of its problems , one way in which Asia is progressing is in its dividend culture .
/ 36 / trustnet . com