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Trade of Decade or Value Trap? Emerging Markets Debate Heats Up

  • Bulls say valuations are getting too cheap to ignore
  • Bears point to weak growth, rising leverage, policy risks
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Is It Time to Buy More Emerging-Market Stocks?

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The great emerging markets debate is heating up.

In the bull camp, money managers from BlackRock Inc. to Franklin Templeton made the case this week that valuations in developing nations are too cheap to pass up. Research Affiliates LLC said buying now could become the “trade of a decade,” after the benchmark stock index dropped 30 percent over the past three years and local-currency bonds lost 26 percent.