Emerging Markets: The Map Is Not the Terrain

Orbis Investments

Research

18 Pages

Orbis argues the old emerging markets playbook no longer fits current realities. The paper highlights cheaper valuations, improving reforms, and a broader opportunity set than headline narratives suggest. It also makes the case that investor skepticism may be overlooking a market trading at a roughly 60% discount to the US.

Key Takeaways

Valuation Gap Is Wide: Emerging markets trade at about 16x earnings versus 38x for US equities.
Reforms Are Becoming Tangible: Samsung Electronics announced a ₩10 trillion buyback in 2024 to support valuation.
Diversification Still Helps: Emerging markets show a 0.66 correlation with US equities since 1988.
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