Value Investing Reigns in Emerging Markets
For Professional Investors Only
4 min read
A Value Advantage in Emerging Markets
Based on rolling five-year periods since 1992, value has outperformed 74% of the time in up markets (right of the Y axis) and 83% of the time in down markets. Each dot represents one five-year period. Value portfolio (low P/B) outperformance is reflected by the orange dots. No strategy works all the time or in all conditions. But value investing has proven to be an extremely reliable approach over time.
Past performance is not indicative of future returns. Y axis: Monthly Rolling 5-year USD annualized return of Low Price/Book (cheapest quintile price to book of MSCI EM universe, equal-weighted data). X axis: Monthly Rolling 5-year USD annualized return of MSCI Emerging Markets Index (gross returns). Source: MSCI, Sanford C. Bernstein & Co., Pzena analysis. Does not represent any specific Pzena product or service. Data through 3/31/2025.
Pzena has unwaveringly adhered to a classic value, research-driven discipline since its inception more than 30 years ago.
FURTHER INFORMATION
These materials are intended solely for informational purposes. The views expressed reflect the current views of Pzena Investment Management, LLC (“PIM”) as of the date hereof and are subject to change. PIM is a registered investment adviser registered with the United States Securities and Exchange Commission. PIM does not undertake to advise you of any changes in the views expressed herein. There is no guarantee that any projection, forecast, or opinion in this material will be realized. Past performance is not indicative of future results.
All investments involve risk, including loss of principal. The price of equity securities may rise or fall because of economic or political changes or changes in a company’s financial condition, sometimes rapidly or unpredictably. Investments in foreign securities involve political, economic and currency risks, greater volatility and differences in accounting methods. These risks are greater for investments in Emerging Markets. Investments in small-cap or mid-cap companies involve additional risks such as limited liquidity and greater volatility than larger companies. PIM’s strategies emphasize a “value” style of investing, which targets undervalued companies with characteristics for improved valuations. This style of investing is subject to the risk that the valuations never improve or that returns on “value” securities may not move in tandem with the returns on other styles of investing or the stock market in general.
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