Just how enamored are equity investors with emerging markets relative to the U.S.?
As it turns out, pretty goddamn enamored.
Although the snapback in the dollar, if it proves to be sustainable, could end up bringing the streak to an unceremonious end, it’s worth noting that the emerging markets ETF has outperformed the S&P ETF for six consecutive months in the longest streak of outperformance since February 2005:
More generally, Bloomberg notes that emerging–market stocks are set for a 1.9% advance in August in the longest run of monthly increases since March 2004.
Remember, this is partially dependent on continued dollar weakness and on expectations that the Fed will not normalize too rapidly (the Fed is far more important for EM than the ECB).
And now the dollar is rebounding.
Maybe it’s time to stop pressing your luck.
Or not.
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