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The new geography of EM investing within our target date solutions

Rich Lang

The possible diversification benefits and long-term return potential for both emerging markets (EM) equity and debt make them asset classes one can’t ignore. But portfolio implementation, particularly for risk-sensitive target date investors, should be carefully considered.

KEY TAKEAWAYS

  • Emerging markets debt and equity allocations can provide diversification and long-term return potential.
  • Capital Group’s long-term capital market assumptions show incrementally higher return expectations for both EM equities and debt.
  • Allocations to EM may offer higher return potential for younger target date participants.

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Rich Lang is a multi-asset investment director with 31 years of investment industry experience (as of 12/31/2024). He holds both a master’s and bachelor’s degree in finance from Loyola Marymount University. 

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