Monday, October 6, 2014

India is getting momentum

In 2011-2013 emerging stock markets suffered serious outflow, in 2014 situation stabilized, but we still can't see any upside in this asset class.

EEM (Emerging markets ETF) vs VT (Total world ETF): 

Except India, where upside momentum already has place.

INP (India ETF) vs VT (Total world ETF): 

So, in case of India we have a long-term underpricing caused by 2011-2013 outflows and a short-term recovery momentum. This makes India good bet for emerging market growth with a 2-3 years horizon, or for a pair trade against global ETFs or against overbought markets like US.

You may take a look at India ETFs here: 

Pair charts are volatility-rebalanced using Cognitum Rebalancer. 

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