Investors Scour Emerging Markets in Search for Trade War Gains
- Shorting Asian currencies and extending duration among bets
- Worst case scenario not priced in, Citi strategists say
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It may be too early to buy the dips in emerging markets, but investors are finding opportunities to stay engaged with the asset class amid the sell-off.
Shorting the most vulnerable currencies, buying the less volatile markets or extending duration are among the strategies picked by strategists at big financial firms including BBVA, Wells Fargo and Morgan Stanley to get around the trade war. As a deal between the U.S. and China before the G-20 summit in late June grows increasingly unlikely, investors say it is time to get selective.