Emerging Markets | October 1, 2026
Reforms, Volumes and Re-Rating: Unlocking the Next Growth Chapter for Emerging Markets
Over the past two decades, performance data from the largest emerging markets has demonstrated that GDP growth, while essential, is not by itself enough to deliver sustained equity market outperformance.
The comprehensive analysis of 18 emerging and frontier markets over 2015 to 2025 in Chart 1 provides strong evidence that real GDP growth without structural reforms fails to generate meaningful equity returns. The negative correlation (-0.298) between real GDP growth and stock performance, consistent across different time periods, fundamentally challenges growth-only focused investment strategies.
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