Year-to-date, investors have funneled $23 billion into emerging market stock funds, with $9 billion added since August. In the week ended Oct. 19, the iShares MSCI Emerging Markets Fund (NYSEArca: EEM) added $1 billion in assets, the iShares FTSE China 25 Fund (NYSEArca: FXI) saw $662.7 million in new inflows and the iShares MSCI Brazil Fund (NYSEArca: EWZ) accumulated $489.3 million, according to IndexUniverse.
Nevertheless, naysayers contend that it could still be too early for the emerging markets. For instance, John Higgins, senior markets economist for Capital Economics, said that investors should sit out at least another year and wait for Europe to sort out its problems.
Additionally, some have pointed to the emerging market stock P/E ratios, which are sitting around 13 times earnings, compared to U.S. shares at 14.8 times earnings, according to MSCI.
“We still don’t think it’s compelling enough,” Christian Thwaites, president and chief executive of Sentinel Investments, said.
For more information on the emerging markets, visit our emerging markets category.
Max Chen contributed to this article.