One of the best-known international stock fund managers is moving money out of emerging markets and into undervalued large-cap stocks in Europe.
David Herro, chief investment officer at Harris Associates, likens the current euphoria in emerging-market stocks to the bubble in the so-called Asian Tiger markets 10 years ago.
Speaking in Chicago an a conference sponsored by the stock and fund research company Morningstar (MORN - Get Report), Herro noted that when the Asian markets hit their peaks in 1997, portfolio and fund managers were recommending that investors hold 15% of their portfolios in Asia.
But after more than 70% of the value of the Asian markets was wiped out, those same managers said investors should reduce their holdings to 0%, says Herro."We are now getting to a stage where there is a lot of euphoria," says Herro, the portfolio manager for the Oakmark (OAKIX) International Fund (OAKIX). "Everyone is saying hold 10% or 15% of their portfolios