Stock Market Ticker

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

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

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Non-Traditional Alpha
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Non-Traditional Alpha

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