Highlights

Analysis on South Africa is published below.

  • The “EM” label does not guarantee a secular bull market.
  • None of the individual EM bourses has outperformed DM on a consistent basis over the past 40 years.
  • EM share performance in both absolute terms and relative to DM has exhibited long-term cycles of around seven to 10 years. Getting these cycles right is instrumental to successful investing in EM.
  • EM investing is predominantly about exchange rates.
  • From a long-term (structural) perspective, EM equities are only modestly cheap in absolute terms but are very cheap versus the U.S.

Feature

We often receive questions from asset allocators about the long-term outlook for EM equities and currencies. The general perception among longer-term allocators is that while EMs may underperform over the short term, they always outperform developed markets (DM) in the long run.

Consistently, the overwhelming majority of investors’ long-term return forecasts ascribe the highest potential return to EM equities and bonds among various regions and asset classes.

This week we focus on the historical long-term performance of EMs. Contrary to popular sentiment, our findings show that EM stocks and currencies have not outperformed their U.S./DM peers in the past 40 years – as long as EMs have existed as an asset class. Hence, there is no guarantee that EM share prices and currencies will always outperform their DM counterparts on a secular basis going forward.

Notably, EM share performance in both absolute terms and relative to DM has exhibited long-term cycles of around seven to 10 years. Getting these cycles right is instrumental to successful investing in EM.

At the moment, the odds are that the current bout of EM equity and currency underperformance is not yet over, and more downside is likely before a major upturn emerges.

The “EM” Label Does Not Guarantee A Secular Bull Market

EM share prices have been in a wide trading range since 2010 (Chart I-1), despite the 10-year bull market in the S&P 500.

Chart I-1
Lost Decade For EM Stocks
Chart I-1

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Remarkably, there is no single EM bourse that has been in a bull market during this decade (Chart I-2 and Chart I-3). This proves that this has indeed been a “lost” decade for EM.

Chart I-2
Individual EM Bourses: A Very Long-Term Perspective
Chart I-2

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Chart I-3
Individual EM Bourses: A Very Long-Term Perspective
Chart I-3

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Historically, secular bull markets have been followed by bear markets not only in the boom-bust economies of Latin America, EMEA and Southeast Asia but also in former Asian tiger economies including Korea, Taiwan and Singapore (Chart I-4). This is despite the fact that per-capita real income has been growing rather rapidly in these Asian economies.

Chart I-4
Former Asian Tigers: Long-Term Equity Performance
Chart I-4

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Remarkably, China and Vietnam have been exhibiting similar dynamics over the past 20 years – rapid per-capita real income growth and poor equity market returns (Chart I-5).

Chart I-5
China And Vietnam: Stock Prices And GDP Per Capita
Chart I-5

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The message from all of these charts is as follows: Periods of industrialization and urbanization – even if successful – do not always entail structural bull markets.

The U.S. fits this pattern as well. During the period between 1870 and 1900, the U.S. was experiencing industrialization and urbanization along with many productivity enhancements such as the steam engine, electricity and infrastructure construction. Even though America’s prosperity and real income per-capita levels surged during this period, corporate earnings per share and stock prices were rather flat (Chart I-6).

Chart I-6
The U.S. In The Late 1800s: Stocks, Profits And GDP
Chart I-6

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Hence, rising per-capita real income and prosperity do not translate into higher share prices on a consistent basis.

This is not to say that no country can ever deliver healthy stock market gains in the long run. Some certainly will, and it is our job to identify and expose these to clients. The point is that the “emerging market” status does not guarantee a structural bull market.

Asset Allocation: Play Cycles

Chart 7 illustrates that EM relative equity performance versus DM in general and the U.S. in particular has gone through several major swings over the past 40 years. Remarkably, none of the individual EM bourses has outperformed DM on a consistent basis over this time frame (Chart I-8A and I-8B).

Chart I-7
EM Versus DM: Relative Total Equity Returns
Chart I-7

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Chart I-8A
No Single EM Bourse Has Outperformed DM In Past 40 Years
Chart I-8A

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Chart I-8B
No Single EM Bourse Has Outperformed DM In Past 40 Years
Chart I-8B

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Failure to outperform DM stocks is not only inherent for bourses in twin-deficit and inflation-prone regions/countries such as Latin America, Russia, Turkey, South Africa and South East Asia (including India), but it has also been true for share prices in rapidly growing countries such as China and Vietnam (Chart I-9).

Chart I-9
Chinese And Vietnamese Stocks Have Not Outperformed DM
Chart I-9

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Remarkably, equity markets in the former Asian tigers – Korea, Taiwan and Singapore – have also failed to outperform their DM peers in the past 40 years (Chart I-10). This is in spite of the fact that real income per-capita growth in these Asian nations has by far outpaced that in both the U.S. and DM (Chart I-11).

Chart I-10
Former Asian Tigers Have Not Outperformed DM Equities...
Chart I-10

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Chart I-11
…Despite Economic Outperformance
Chart I-11

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Evidently, the assumption that EM stocks will outperform DM equities on the back of higher potential growth rates is not validated by historical data. First, higher potential growth does not always ensure robust realized GDP growth.

Second, even if real GDP-per-capita growth rises considerably, this does not always guarantee superior equity market returns. Some of the reasons for this include productivity benefits being transferred to employees rather than to shareholders, chronic equity dilution, and a misallocation of capital that boosts economic growth at the expense of shareholders.

Bottom Line: EM relative stock performance versus DM has been fluctuating in well-defined long-term cycles. In our view, EM relative equity performance has not yet reached the bottom in this downtrend.

We downgraded EM stocks in April 2010 and have been recommending a short EM equities / long S&P 500 strategy since December 2010 (please refer to Chart I-7 on page 5).

EM Investing Is Primarily About Exchange Rates

Exchange rates hold the key to getting EM equity cycles right for international investors. As demonstrated in Chart I-12, historically the bulk of EM equity return erosion has been due to currency depreciation.

Chart I-12
EM Investing Is All About Exchange Rates
Chart I-12

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Exchange rates of structurally weak EM economies depreciate chronically. Common reasons include lack of productivity growth, high inflation, current account deficits, uncontrolled fiscal expansion, and reliance on volatile foreign portfolio flows.

Periods of currency depreciation also occur in emerging Asian economies that have low inflation and typically run current account surpluses. Chart I-13 shows spot rates for Korea, Taiwan and Singapore versus the SDR which is a weighted average of USD, the euro, JPY, GBP, and CNY.1

Chart I-13
Former Asian Tiger Currencies: Wide Fluctuations
Chart I-13

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None of these Asian-tiger currencies has consistently appreciated versus the SDR. As in the case of share prices, there have been multi-year exchange rate swings.

Further, U.S. dollar total returns on EM local bonds are also primarily driven by their currencies (Chart I-14). Consequently, the cycles in EM local currency bonds match EM exchange rate cycles.

Chart I-14
Total Return On Local Currency Bonds
Chart I-14

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EM credit spread fluctuations are also by and large contingent on their exchange rates. Credit spreads on EM sovereign and corporate U.S. dollar bonds gauge debt servicing risk. The latter is highly influenced by exchange rates. Currency depreciation (appreciation) increases (decreases) debt servicing costs thereby affecting credit spreads.

Bottom Line: Exchange rate fluctuations are driven by macro crosscurrents, making macro an indispensable know-how for EM investing.

We maintain that EM currencies are susceptible to renewed weakness against the U.S. dollar as China’s growth continues to weaken, weighing on EM growth and thereby their respective exchange rates (Chart I-15). In turn, the U.S. dollar is a countercyclical currency and does well when global growth decelerates.

Chart I-15
EM Currencies Are Pro-Cyclical
Chart I-15

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Valuations: The Starting Point Matters…

In recent years, a long-term bullish case for EM equities and currencies has often been made on the grounds of cheap valuations.

Chart I-16 illustrates the equity market-cap weighted real effective exchange rate for EM ex-China, Korea and Taiwan – a measure that is pertinent for both EM equity and fixed-income investors.2 It reveals that EM currency valuations are only slightly below their historical mean.

Chart I-16
EM Ex-China, Korea, Taiwan Currencies Are Modestly Cheap
Chart I-16

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As to the CNY, KRW and TWD, their valuations are not at an extreme, and the CNY holds the key. The main long-term risk to the RMB is capital outflows from Chinese households and companies as discussed in February 14 report.

For long-term investors, the pertinent equity valuation yardstick is the cyclically adjusted P/E (CAPE) ratio.

The idea behind the CAPE model is to remove cyclicality of corporate profits when computing the P/E ratio – i.e., to look beyond a business cycle. Hence, the CAPE ratio is a structural valuation model – i.e., it works in the long term. Only investors with a time horizon greater than three years should use this valuation measure in their investment decisions.

Our CAPE model gauges equity valuations under the assumption of per-share earnings converging to their trend line. The latter is derived by a regression of the cyclically adjusted EPS in real U.S. dollar terms on time.

The EM CAPE ratio presently stands at 0.5 standard deviations below its historical mean (Chart I-17). This means EM stocks are modestly cheap from a long-term perspective. Meanwhile, the U.S.’s CAPE ratio is very elevated (Chart I-18).

Chart I-17
EM Equities Are Modestly Cheap From AA1 Structural Perspective
Chart I-17

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Chart I-18
U.S. Stocks Are Expensive From AA1 Structural Perspective
Chart I-18

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On a relative basis, EMs are very attractive relative to U.S. stocks (Chart I-19). This entails that the probability of EM stocks outperforming U.S. equities is very high from a secular perspective – longer than three years.

Chart I-19
EM Equities Are Cheap Versus U.S. From AA1 Structural Perspective
Chart I-19

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Nevertheless, a caveat is in order. Our CAPE model assumes that EPS in real U.S. dollar terms will rise at the same pace as it has historically. The slope of the time trend – the historical compound annual growth rate (CARG) of EPS in inflation-adjusted U.S. dollar terms – is 2.8% for EM and 2% for the U.S. Please note that we determined the earnings time trend (trend line) using historical ranges – 1983 to present for EM, and 1935 to present for the U.S.

Hence, these CAPE models assume that EM EPS will grow 0.8 percentage points (2.8% minus 2%) faster than U.S. corporate EPS in inflation-adjusted U.S. dollar terms, as they have done historically. Under this assumption, EM stocks are considerably cheaper than the U.S. market.

That said, in the medium term, corporate earnings are the key driver of EM share prices, and contracting profits pose a risk to EM performance, as discussed in our February 21 report.

Bottom Line: From a long-term perspective, EM equities and currencies are only modestly cheap in absolute terms.

Based on our CAPE ratio model, EM stocks are very cheap versus the U.S. However, the CAPE ratio is a structural valuation measure, and only investors with a time horizon of longer than three years should put considerable emphasis on it.

…But Beware Of A Potential Value Trap

If for whatever reason there is a change in the slope of the EM EPS long-term trend – i.e., per-share earnings fail to expand in the coming years at their historical rate, as discussed above, our CAPE model would be invalidated. In such a case, EM share prices are unlikely to enter a secular bull market in absolute terms and outperform their U.S. counterparts structurally.

The key to sustaining the current upward slope in the long-term trajectory of EPS in real U.S. dollar terms is for EM/Chinese companies to undertake corporate restructuring and increase efficiency.

Critically, recurring Chinese credit and fiscal stimulus as well as cheap and abundant money from international investors have not fostered corporate restructuring in China, nor in other EM countries. The basis is that easy and cheap financing and economic growth propped-up by periodic Chinese stimulus has made companies complacent, undermining their productivity and efficiency. The ultimate outcome will be weak corporate profitability over the long run.

Another long-term risk to corporate earnings in China and some other EMs is the expanding role of the state in the economy. In these circumstances, China/EM corporate profitability will also suffer over the long run. The basis is that in any country the private sector is better than the government in generating strong corporate earnings.

Bottom Line: Without structural reforms and corporate restructuring in EM/China, EM stocks are unlikely to outperform their DM peers on a secular basis.

Investment Conclusions

  • The medium-term EM outlook remains poor for the reasons we elaborated on in last week’s report titled, EM: A Sustainable Rally or A False Start?
    Further, investor sentiment on EM is very bullish, and positioning in EM equities and currencies is elevated (Chart I-20). We continue to recommend underweighting EM stocks, credit markets and currencies versus their DM counterparts and the U.S. in particular.

Chart I-20
Investors Are Very Bullish On EM
Chart I-20

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  • From a long-term perspective, EM equity and currency valuations are modestly cheap.
    However, a durable long-term expansion in EM economies is contingent on a sustainable bottom in Chinese growth. The latter hinges on deleveraging and corporate restructuring in China, neither of which have occurred to a meaningful extent.
  • For EM equity portfolios, we presently recommend overweighting Mexico, Brazil, Chile, central Europe, Russia, Thailand and Korean non-tech stocks. Our current (not structural) underweights are South Africa, Indonesia, India, the Philippines, Hong Kong and Peru.
    Within the EM equity space, two weeks ago we booked triple-digit profits on our strategic long positions in EM tech versus both the overall EM index and EM materials stocks, respectively. These positions were initiated in 2010. The basis for these strategic recommendations was our broader theme for the decade of being long what Chinese consumers buy, and short plays on Chinese construction, which we initiated on June 8, 2010.
    This week we are closing our long central European banks / short euro area banks equity position. We recommended it on April 6, 2016, and it has produced a 14% gain since then.

Arthur Budaghyan
Chief Emerging Markets Strategist
arthurb@bcaresearch.com

South Africa: Debt Deflation Or Currency Depreciation?

South Africa’s public debt dynamics are on an unsustainable track. Two prerequisites for public debt sustainability are (1) for interest rates to be below nominal GDP growth or (2) continuous robust primary fiscal surpluses. Hence, a government can stabilize its debt-to-GDP ratio by either having nominal GDP above its borrowing costs, or by running persistent and sizable primary fiscal surpluses.

Neither of these two stipulations are presently satisfied in South Africa. The gap between government local currency bond yields and nominal GDP growth is at its widest in over the past 10 years (Chart II-1). Meanwhile, the primary fiscal deficit is 0.75% of GDP (Chart II-2).

Chart II-1
South Africa: An Unsustainable Gap
Chart II-1

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Chart II-2
South Africa Has Not Had A Primary Fiscal Surplus In A Decade
Chart II-2

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Faced with very low real potential GDP growth stemming from the economy’s poor structural backdrop, the authorities in South Africa ultimately have two choices to stabilize the public debt-to-GDP ratio:

  1. Tighten fiscal policy substantially, trying to achieve persistent large primary budget surpluses; or
  2. Inflate their way out of debt, which would require a large currency depreciation to boost nominal GDP growth above borrowing costs.

With this in mind, we performed a simulation on public debt, assuming fiscal tightening but no substantial currency depreciation (Table II-1). The first scenario uses the 2019 consolidated budget government assumptions and projections for nominal GDP, government revenues and expenditures, i.e., it is the government's scenario. In this scenario, the public debt-to-GDP ratio rises only to 58% by the end of the 2021-‘22 fiscal year.

Table II-1
Projections For South Africa Fiscal Position And Public Debt
Table II-1

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However, government forecasts always end up being optimistic. We believe this scenario is implausible due to its overestimation of nominal GDP, and hence government revenue growth. As the government tightens fiscal policy, nominal GDP growth and ultimately government revenue will disappoint substantially.

For the second scenario, we used government projections for fiscal spending in the coming years, but our own estimates for nominal GDP and government revenue growth.

Notably, excluding interest payments and fiscal support for ailing state-owned enterprises like Eskom, nominal growth of government expenditures in the current year is at 7.5%, and estimated to be 6.8% the next two fiscal years. That is why we project nominal GDP and government revenue growth to be very weak.

The basis of our assumption is as follows: Barring considerable currency depreciation, as the authorities undertake substantial fiscal tightening in the next three years, nominal GDP and consequently government revenue growth will plunge. Importantly, government revenues exhibit a non-linear relationship with nominal GDP – government revenues fluctuate much more than nominal GDP (Chart II-3).

Chart II-3
Government Revenues Are 'High-Beta' On Nominal GDP Growth
Chart II-3

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As government revenue growth underwhelms, the primary deficit will widen and the public debt-to-GDP ratio will escalate, reaching 70% of GDP by the end of the 2021-‘22 fiscal year, according to our projections (Table II-1).

Overall, without considerably lower interest rates and material currency depreciation, the government’s financial position will enter a debt deflation spiral. Fiscal tightening will hurt nominal growth damaging fiscal revenues. As a result, the fiscal deficit will widen – not narrow – and the debt-to-GDP ratio will rise.

Therefore, the only feasible option for South Africa to stabilize public debt is to reduce interest rates dramatically and depreciate the currency. This will engender higher inflation and nominal growth, thereby boosting government revenues and capping the public debt burden.

At 10%, the share of foreign currency debt as part of South Africa’s public debt is low. Hence, currency depreciation will do less damage to public debt dynamics than keeping interest rates at high levels.

On the whole, the rand is a very structurally weak currency, and is bound to depreciate due to deteriorating public debt dynamics. Chart II-4 plots the real effective exchange rate of the rand based on CPI and PPI. It is evident that its valuation is not yet depressed.

Chart II-4
The Rand Is Modestly Cheap
Chart II-4

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Meanwhile, cyclical headwinds also warrant currency depreciation (Chart II-5).

Chart II-5
Widening Trade Deficit Warrants Currency Depreciation
Chart II-5

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Market Recommendations

  • Continue shorting the ZAR versus the U.S. dollar and the MXN.
  • Consistent with the negative outlook for the exchange rate, investors should underweight South African local currency government bonds and sovereign credit within respective EM portfolios.
  • Finally, we recommend EM equity portfolios remain underweight South African equities.

Andrija Vesic, Research Analyst
andrijav@bcaresearch.com

Arthur Budaghyan
Chief Emerging Markets Strategist
arthurb@bcaresearch.com

 

Footnotes

  • 1       Special Drawing Rights. The value of the SDR is based on a basket of five currencies: the U.S. dollar, the euro, the Chinese renminbi, the Japanese yen, and the British pound sterling.
  • 2      We exclude these three currencies since their bourses have very large equity market cap in the EM stock index and, hence, would make any aggregate currency measure unrepresentative for the rest of EM.

 

Equity Recommendations

POSITIONS ALLOCATION INITIATION
DATE
RETURN IN US$
ON EM EQUITY BENCHMARK
SHORT EM/LONG U.S. STOCKSDEC 14/10149.8%
SHORT EM STOCKSMAY 24/116.5%
COUNTRY ALLOCATION
OVERWEIGHT
KOREA EX-TECHOVERWEIGHTMAY 31/18-0.7%
CZECH REPUBLICOVERWEIGHTJUN 21/11-47.8%
HUNGARYOVERWEIGHTMAY 20/1574.0%
POLANDOVERWEIGHTAPR 06/16-9.6%
THAILANDOVERWEIGHTOCT 19/1610.9%
CHILEOVERWEIGHTJAN 03/18-7.2%
MEXICOOVERWEIGHTAPR 12/18-11.9%
RUSSIAOVERWEIGHTOCT 04/18-1.7%
BRAZILOVERWEIGHTOCT 09/183.4%
UNDERWEIGHT
PERUUNDERWEIGHTSEP 02/15-35.5%
SOUTH AFRICAUNDERWEIGHTAPR 05/179.3%
INDONESIAUNDERWEIGHTMAY 09/18-11.9%
PHILIPPINESUNDERWEIGHTOCT 04/18-8.0%
INDIAUNDERWEIGHTOCT 04/18-7.0%
HONG KONG - DOMESTIC STOCKSUNDERWEIGHTOCT 11/18-6.8%
NEUTRAL
SINGAPORENEUTRALSEP 09/15
CHINANEUTRALDEC 20/17
TURKEYNEUTRALAUG 15/18
MALAYSIANEUTRALOCT 04/18
TAIWANNEUTRALOCT 18/18
COLOMBIANEUTRALJAN 17/19
KOREA TECH SECTORNEUTRALFEB 28/19
OTHER EQUITY RECOMMENDATIONS - RELATIVE TRADES
SHORT CHINESE PROPERTY COMPANIES / LONG U.S. HOMEBUILDERSMAR 06/1292.8%
SHORT EM BANKS / LONG U.S. BANKSFEB 12/1388.0%
LONG CHINESE SMALL CAPS / SHORT EM SMALL CAPSNOV 20/13-0.1%
LONG CENTRAL EUROPE BANKS / SHORT EURO AREA BANKS STOCKSAPR 06/1614.3%
LONG LARGE 5 STATE-OWNED CHINESE BANKS / SHORT SMALL AND MEDIUM SIZE CHINESE BANKSOCT 26/1615.6%
LONG INDIAN SOFTWARE / SHORT EM STOCKSDEC 21/1617.5%
LONG SINGAPORE REAL ESTATE / SHORT HONG KONG REAL ESTATE STOCKSMAR 22/17-6.0%
SHORT EM STOCKS / LONG U.S. 30-YEAR TREASURIESAPR 10/17-8.2%
LONG EM CONSUMER STAPLES / SHORT EM BANKS STOCKSMAY 31/18-9.6%
LONG LATAM / SHORT EM ASIA STOCKSOCT 11/18-4.7%
LONG TURKEY BANKS / SHORT EM BANKS STOCKSNOV 29/18-1.9%
LONG MALAYSIAN SMALL CAPS / SHORT EM SMALL CAPSDEC 14/181.6%
OTHER EQUITY RECOMMENDATIONS - ABSOLUTE TRADES
LONG EM EQUITY VOLATILITY (ETF: VXEEM)MAR 06/12-39.5%
SHORT SOUTH AFRICAN GENERAL RETAILERSAPR 23/1349.6%
SHORT MALAYSIAN BANK STOCKSJUL 20/16-19.2%
SHORT PHILIPPINES REAL ESTATE STOCKSNOV 01/18-11.5%

NOTE: RETURNS RELATIVE TO BENCHMARK. MSCI FOR EQUITY RECOMMENDATIONS UNLESS OTHERWISE SPECIFIED.
* CALCULATED USING THE HO CHI MINH STOCK EXCHANGE INDEX.
** BASED ON THE AVERAGE OF MSCI INVESTABLE AND MSCI A-SHARE INDECES.
*** SOURCE: BLOOMBERG FINANCE L.P.

Fixed-Income, Credit And Currency Recommendations

POSITIONS INCEPTION
LEVEL
INITIATION
DATE
RETURN
TO DATE
STOPS
FIXED-INCOME
RECEIVE KOREAN 10-YEAR SWAP RATESMAY 24/11244 BPs
SHORT 5-YEAR INDONESIAN BONDS5.20%MAR 20/125.0%
RECEIVE INDIAN 1-YEAR/PAY 10-YEAR SWAP RATESJUL 06/164 BPs
LONG POLAND AND HUNGARY 5-YEAR BONDS / SHORT SOUTH AFRICA AND TURKEY 5-YEAR BONDSJUL 27/1625.0%
LONG THAI 5-YEAR BONDS / SHORT MALAYSIAN 5-YEAR BONDSMAR 21/180.0%
RECEIVE MEXICAN 2-YEAR / PAY 10-YEAR SWAP RATESAPR 12/183 BPs
RECEIVE 3-YEAR CHILEAN SWAP RATES3.53%MAY 31/185 BPs
RECEIVE EURO AREA 3-YEAR/PAY HUNGARIAN 3-YEAR SWAP RATESJUL 01/18-41 BPs
RECEIVE COLOMBIAN 10-YEAR / PAY 1-YEAR SWAP RATESJAN 17/197 BPs
CREDIT MARKETS
LONG 5-YEAR CHINESE CDSJUN 07/11-29 BPs
SHORT SOUTH AFRICAN / LONG EM SOVEREIGN CREDITAPR 10/122.8%
LONG EMERGING ASIA INVESTMENT GRADE / SHORT HIGH YIELD CORPORATE BONDSFEB 11/15-13.2%
LONG HUNGARY / SHORT EM SOVEREIGN CREDITMAR 04/15-4.5%
LONG 5-YEAR MALAYSIAN CDSAUG 05/15-88 BPs
SHORT EM CORPORATE AND SOVEREIGN CREDIT / LONG U.S. INVESTMENT GRADE CORPORATE CREDITAUG 16/17-0.7%
CURRENCIES
SHORT IDR / LONG USD 9155 (USD/IDR)MAR 20/125.6%
DOUBLE UP: SHORT IDR / LONG USD13888 (USD/IDR)APR 26/18-2.5%
SHORT CLP / LONG USD 478.9 (USD/CLP)NOV 06/1214.7%
SHORT ZAR / LONG USD10.51 (USD/ZAR)JUL 23/144.8%
SHORT CNY (12-MONTH NDF) / LONG USD6.71 (USD/CNY)DEC 09/15-7.1%
SHORT MYR / LONG USD3.98 (USD/MYR)JUL 20/16-3.5%
LONG CZK / SHORT EUR26.96 (EUR/CZK)SEP 28/164.4%
LONG 3-MONTH USD/KRW VOLATILITY10.81%JAN 25/17
LONG PLN / SHORT IDR 3497.64 (PLN/IDR)JUN 21/17-1.6%
LONG CLPUSD / SHORT COPPERSEP 06/17-2.5%
SHORT KRW / LONG BASKET OF USD & JPY FEB 14/183.2%
LONG MXN / SHORT ZAR 1.54 (ZAR/MXN)MAR 29/1812.1%
LONG RUB / SHORT COP 46.33 (COP/RUB)MAY 31/185.8%
LONG JPY / SHORT SGD 82.02 (SGD/JPY)JUN 08/18-1.7%

NOTE: PLEASE NOTE THAT ALL CURRENCY TRADE CALCULATIONS INCLUDE COST OF CARRY.