Deuchars joins from Schroders, where she was a senior equity analyst, covering emerging markets. Prior to this, she was an equity analyst with WestAM.
“I am very pleased to welcome Bryony to Aviva Investors,” said Will Ballard, head of emerging market and Asia Pacific equities. “She has a very strong track record in both country and equity analysis, and a deep understanding of what drives emerging markets. This background is an excellent fit as we continue to grow the team,” he said.
According to Ballard, emerging markets have been the stand out performer among equity markets year to date, much to most market commentators’ surprise.
“With regards to the impact of Brexit, increased political uncertainty has had the quixotic effect of aiding a recovery in emerging markets in the short term Developed market central bankers will invariably ensure monetary policy is accommodative and keep interest rates lower for longer,” he said. “This provides many emerging countries with the opportunity to lower domestic interest rates and stimulate growth without having to worry excessively over currency weakness or capital flight.”
Paradoxically, noted Ballard, one of the often perceived riskier asset classes is even being tentatively labelled as a safe haven by some industry commentators.
“The combination of easing monetary policy in emerging markets, with their exceptional discount to developed markets, and being cheap on absolute measures, makes them a highly attractive investment opportunity,” he explained.
Ballard went on to point out that Aviva favours countries that will benefit most from easing monetary conditions and a recovery in domestic growth, and in line with this the firm has been increasing its exposure to Indonesia recently.
Meanwhile, Aviva remains concerned about countries where it believes there are long term structural concerns, such as China.
“On a sector basis, we are increasing our exposure to more cyclically-sensitive and undervalued sectors such as consumer discretionary, energy and materials. At the same time, we are reducing and remaining underweight sectors which will struggle with lower rates and where we also believe there are structural issues, such as Banks,” added Ballard.
