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Emerging Perspectives

Applying lessons from Latin America’s past to Turkey’s future

21 May 2019
Authors: Grant WebsterPortfolio Manager, Fixed Income, Vivienne TabererPortfolio Manager

Some common threads exist in the richly-diverse emerging market tapestry. And these can provide valuable, if rather unexpected, insights for investors.

Take Turkey – a country hitting the headlines for all the wrong reasons. Recent discussions among our regional experts have uncovered interesting parallels between it and three countries in Latin America: Brazil, Argentina and Venezuela. The journeys of these range from an impressive turnaround story to a tragic demise. Which, if any, Turkey ends up emulating is of crucial importance to emerging market debt investors given Turkey’s significant index weight.

Turkey could follow a similar path to Argentina - a journey that’s far from over and has been anything but smooth.

Our analysis leads us to believe that Turkey could follow a similar path to Argentina, where the Kirchner leadership was hailed as the harbinger of stability before shifting to populist policy and economic mismanagement, resulting in an IMF-bail-out and much needed regime change. A journey that’s far from over and has been anything but smooth. This helps to explain our cautious-positioning in Turkey’s sovereign bonds and the lira – a stance that has helped to cushion our investors’ assets from recent Turkish market weakness.

Here’s a summary of our Turkish analysis through a Latin American lens.

Read the paper


Emerging market: These markets carry a higher risk of financial loss than more developed markets as they may have less developed legal, political, economic or other systems.

Grant Webster
Grant Webster Portfolio Manager, Fixed Income
Vivienne Taberer
Vivienne Taberer Portfolio Manager

Additional Information:

This material is for informational purposes only and should not be construed as an offer, or solicitation of an offer, to buy or sell securities. All of the views expressed about the markets, securities or companies reflect the personal views of the individual fund manager (or team) named. While opinions stated are honestly held, they are not guarantees and should not be relied on. Investec Asset Management in the normal course of its activities as an international investment manager may already hold or intend to purchase or sell the stocks mentioned on behalf of its clients. The information or opinions provided should not be taken as specific advice on the merits of any investment decision. This content may contain statements about expected or anticipated future events and financial results that are forward-looking in nature and, as a result, are subject to certain risks and uncertainties, such as general economic, market and business conditions, new legislation and regulatory actions, competitive and general economic factors and conditions and the occurrence of unexpected events. Actual results may differ materially from those stated herein.

All rights reserved. Issued by Investec Asset Management, issued May 2019.

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