Emerging markets are getting a hard lesson in tech hype as the AI boom takes hold. Veteran emerging market fund manager Carlos von Hardenberg notes that investors are now interested in more than just U.S. tech stocks.
AI Boom Impact
The AI boom has had a significant impact on South Korean and Taiwanese firms, which dominate high-tech memory chip making. However, this growth has come with extreme volatility, with South Korea’s KOSPI index falling 40% in six weeks.
Investors are struggling with the level of volatility in Korea, with some questioning whether the fundamental positive earnings story is worth pursuing. The recent rout saw the most dramatic drop in the MSCI EM index’s liquidity factor ever, with investors moving away from the shares that had been surging.
Riding the Volatility
Some investors are advising to ride the volatility and avoid overhyped names. UBP technology portfolio manager Dimitri Kallianiotis says that if you are not invested in the tempest days, you won’t be there for the rebound.
Original reporting: Appleton, WI News Feed (HLL/CB) — read the source article.
