India stocks and country-related exchange traded funds may stand out among emerging markets funds this year as general elections in May could put a reform-minded government in place.
Fund managers are already positioning ahead of the world’s largest general election in India, anticipating that India’s opposition party leader Narendra Modi will either win a majority or be able to form a coalition government to implement economic reforms, reports Madison Marriage for Financial Times.
India is expected to “come out of the election with a government keener to make changes and boost economic activity,” Stephen Jones, chief investment officer at Kames Capital, said in the article.
Observers calculate that Modi’s BJP part would need 260 seats to implement important reforms in areas like agriculture, banking and industrials.
Kunal Desai, manager of Neptune Investment Management’s India fund, argues that the reforms would help bolster cyclical and mid-cap stocks in India as domestic investors return to the market. [Foreign Investors Return to India]