Emerging market stocks and related exchange traded funds have consistently underperformed the developed markets and are now trading near all-time low valuations.

Since the 2010, emerging markets have generated a total return of -2.1%, whereas developed markets returned 69.1%, reports Steve Johnson for the Financial Times.

Looking at average annualized returns over the past five-years, the Vanguard FTSE Emerging Markets ETF (NYSEArca: VWO) dipped 3.2% and the iShares MSCI Emerging Markets ETF (NYSEArca: EEM) fell 4.0%. Meanwhile, the iShares MSCI EAFE ETF (NYSEArca: EFA) gained 4.2% and SPDR S&P 500 ETF (NYSEarca: SPY) increased 14.0%.

After years of weakness, the MSCI Emerging Markets Index is now trading at 12.8 times 10-year average earnings as of the end of September, compared to the previous low of 13.5 times during the 1997-98 Asian financial crisis and much lower than its long-term average of 25 times average 10-year earnings.

Meanwhile, the S&P 500 index is trading at a 23.4 times cyclically adjusted earnings, just shy of its long-term average of 23.6.

EEM currently shows a price-to-earnings ratio of 11.9 and VWO has a 11.8 P/E, according to Morningstar data. In contrast, EFA is trading at a 16.0 P/E and SPY shows a 18.6 P/E.

While the recent selling has depressed emerging market valuations, some argue that ongoing economic headwinds can still weigh on developing country equities.

“The latest leg of correction leaves emerging markets as the unambiguously cheap segment of global equity on a fundamental basis [but], with the exception of Russia, valuations simply haven’t become cheap enough,” George Iwanicki, emerging markets macro strategist at JPMorgan AM, told the Financial Times.