This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Emerging Markets 10-Year Bull Run Is Done: Goldman

NEW YORK ( TheStreet) -- After a decade of outperformance. emerging markets stocks and bonds are headed for choppy seas, according to Goldman Sachs economists.

Forecasters at the investment bank argue emerging markets assets "are unlikely to deliver anything close to the kind of risk-reward that investors had become used to" in the last decade, and they add that "absolute returns are likely to be much lower."

Five trends have contributed to the emerging market outperformance, Goldman's economists write. These include massive Chinese growth, rising commodity prices , sovereign deleveraging, tame inflation and falling interest rates in the U.S. All of these trends are now either reversing or flattening out, according to the report.

On the plus side, Goldman's economists write that emerging markets are on sounder financial footing than they were in the past, and they have lower debt-to-GDP ratios than many developed world countries.

Emerging markets stocks have certainly taken it on the chin of late. Vanguard MSCI Emerging Markets ETF (VWO), for example, is down more than 15% since May 8 vs. a 1.21% drop for the S&P 500.

-- Written by Dan Freed in New York.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
VWO $44.67 0.00%
AAPL $130.28 0.00%
FB $81.53 0.00%
GOOG $565.06 0.00%
TSLA $218.42 0.00%


DOW 18,080.14 +21.45 0.12%
S&P 500 2,117.69 +4.76 0.23%
NASDAQ 5,092.0850 +36.0220 0.71%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs