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Emerging Markets

Our Emerging Markets strategy is designed to provide all-cap exposure to countries with the potential to outperform the index with less volatility. Our investment process is based on mathematical principles of diversification, compounded growth, and volatility capture.

Strategy Goals

Parametric’s Systematic Alpha strategies are broadly diversified and dynamically rebalanced portfolios designed to outperform capitalization-weighted approaches over the long term with less risk. Diversification is established via a system of portfolio target weights. As market forces move the portfolios’ holdings away from the target weights, diversification is re-established via a trigger-based rebalancing process. Our active reweighting and rebalancing have the potential to generate excess returns. Parametric’s experience constructing and managing portfolios for over 25 years has informed and enhanced the development of our Systematic Alpha strategies.


The Parametric Emerging Markets strategy is an all-cap equity strategy that includes large, mid- and, small-cap stocks in over 50 developing countries. A unique feature of our strategy is that it invests across both emerging and frontier markets. The strategy utilizes a top-down, three-part process designed to actively eliminate country and sector concentrations, and applies a disciplined, unemotional trading approach to build and maintain the strategy’s investment exposures.

Investment Philosophy

We utilize an engineered and disciplined approach to exploit the unique characteristics of the emerging markets equity asset class.


 

Country Selection

 

  • Broad country universe
  • Countries are equally-weighted within each of the model tiers

 

Rebalancing

 

  • A systematic rebalancing trigger brings countries back to target weights
  • Determined by country-specific transaction costs


 

Sector and Stock Allocation

 

  • Robust investment process maintains exposure to major economic sectors
  • Highly-diversified equity holdings throughout the global marketplace

How to Invest and Related Products

The investment strategy described herein is designed to be implemented in a separately managed account (SMA) maintained by a qualified custodian. Investors should contact their financial advisor to establish an SMA. Parametric currently serves as a sub-adviser to investment products offered and distributed by its affiliate, Eaton Vance Distributors, Inc., a registered broker-dealer. Parametric sub-advises a fund with a strategy similar to the one presented herein. For more information on related products, please visit https://funds.eatonvance.com*.



*We are providing a link to the Eaton Vance website for your convenience only. It is for informational purposes only and is not an offer to buy or sell any security. Although Parametric is an affiliate of Eaton Vance, Parametric does not administer the website or control any of its content. Accordingly, such link is provided “as is”, without representation or warranty, express or implied, as to the accuracy of such content or its completeness or timeliness, all of which (including, without limitation, any implied warranties of merchantability or fitness for a particular purpose) Parametric expressly disclaims. Such link’s appearance on Parametric’s website should not imply our endorsement of the linked site or its content. Parametric is not responsible for your use of the linked site, its content, or any other resources (including, without limitation, other linked sites and their contents) accessible through it. If you choose to leave this website and visit the linked site, you will be subject to its terms of use and privacy policies. By clicking below and continuing to the linked site, you acknowledge and agree to the foregoing.


The Emerging Markets strategy is offered by Parametric Investment & Overlay Strategies.  For additional information please visit the Disclosure page.

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