Emerging Markets Have Diverged: A Look At Attractive Countries

Now that emerging markets, especially those with current account deficits, have started to stumble due to concerns about the effects of tapering and rising US Treasury yields value, investors are looking for assets that got caught up in the panic and which may now be undervalued. Societe Generale analysts Paul Jackson and Ida Troussieux have tried to answer this question with a two pronged approach. First, they use five criteria to determine which emerging market countries present the most macro risk, then they look for asset classes in low-risk that look like they have lost more value than you would have expected and could be ready for a rebound.

Building on the work of their colleague Daniel Fermon, they look...