Posted by on Nov 9, 2019 in Articles & Advice, Blog, Columns, Featured |

Image Credit: Alex Nabaum



By Jason Zweig | Nov. 8, 2019 11:00 am ET


Emerging markets have finally emerged — by one measure, anyway.

It’s not that companies whose shares trade on the stock markets of developing nations have been generating great returns lately. Instead, they’ve adopted at least one major characteristic of the world’s most-advanced economies: artificially smoothing their earnings to pander to analysts and investors.

Research from Rayliant Global Advisors, an investment firm based in Hong Kong, finds that such “earnings management” has become even more widespread in emerging markets than in developed markets like the U.S., Europe or Japan. That could help explain the disappointing performance of developing markets in recent years — and suggests they remain riskier than some U.S. investors may think.


To read the rest of the column:


For further reading:


Benjamin Graham, The Intelligent Investor

Jason Zweig, The Devil’s Financial Dictionary

Jason Zweig, Your Money and Your Brain

Jason Zweig, The Little Book of Safe Money


Articles and other resources:

Earnings Management: Developed vs. Emerging Markets” (Rayliant Global Advisors)

Emerging Markets: Getting Comfortable with the Uncomfortable” (GMO)

Pundits Predicting Panic in Emerging Markets” (Research Affiliates)

Compendium of posts on investing in emerging markets (Lawrence Hamtil)

Under the ‘Emerging’ Curtain

Think Before You Fish for Bargains in Chinese Stocks

Emerging Markets Look Appetizing…Again

A Short History of Folly