New research from data company Pureprofile suggests that wealth managers and advisers expect clients to significantly boost investments in emerging and frontier markets over the next 18 months.
Commissioned by Vietnam Enterprise Investments Limited (VEIL), a Vietnam-focused investment fund, the study found that 64% of those surveyed anticipate a client allocation increase of 10-15% in these markets.
Two-thirds believe clients are currently underexposed to emerging markets, and they see opportunities for stronger growth compared to developed markets.
In fact, 92% of respondents expect emerging and frontier market growth to outpace that of developed markets over the next five years.
The growing middle class in emerging and frontier countries was cited as the primary attraction for these markets, followed by perceptions that many of them are undervalued.
Additionally, the technological advancements underway in these regions are expected to benefit these markets more than developed economies.
Other positive factors include increasing stability in some of these markets and rising foreign direct investment (FDI).
Frontier markets, in particular, are seen as ideal for active fund management. Nearly all respondents (99%) agreed that these markets present unique opportunities for active managers to outperform, given the limited company disclosures and lower analyst coverage compared to developed and emerging markets.
By the end of 2025, 93% of wealth managers and advisers predict their clients will have a higher exposure to emerging markets.
Vietnam stands out as a promising example, showing notable signs of economic recovery. The country’s trade surplus is at a four-year high, with exports up 14.5% and imports rising by 12.4% year-on-year.
Industrial production and retail sales are also on the rise, with a 7.9% increase in retail activity. Foreign direct investment inflows have reached their highest level since 2012, contributing to a stronger-than-expected first half of the year.
In response, Vietnam’s prime minister has set a budget revenue target for 2024 to exceed 10%, while urging faster public investment disbursement to hit a 95% target, supporting further economic growth.
Tuan Le, lead portfolio manager of VEIL, said: “Many emerging and frontier markets are dynamic and enjoying rapid positive change and growth. This represents an exciting opportunity for active investors, and our research shows that many wealth managers and IFAs expect clients to increase their exposure to these markets.”
Established in 1995, Vietnam Enterprise Investments Limited (VEIL) is a closed-end fund, trading on the Main Market of the London Stock Exchange.
With a net asset value (NAV) of £1.7bn, VEIL is the longest running fund focused on Vietnam and one of the largest that invests primarily in listed and pre-IPO companies in Vietnam that offer attractive growth and value metrics, and strong corporate governance.
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