{"type":"rich","version":"1.0","provider_name":"Transistor","provider_url":"https://transistor.fm","author_name":"In Conversation with Julie Segal","title":"Investors Know What Not to Do in Emerging Markets. But They Keep Doing It Anyway.","html":"","width":"100%","height":180,"duration":2127,"description":"Robert Koenigsberger isn’t rattled by uncertainty, at least when it comes to markets. \nThat may be simply part of his natural constitution. He started his career in the 1980s when emerging markets were essentially a collection of bank loans in default — and he founded Gramercy, the emerging markets alternatives firm, in 1998 when Russia devalued its currency and kicked off the restructuring of its government debt.  \nThat experience comes in handy now as developed markets are facing the kind of uncertainty once reserved for emerging markets. Investors are facing wars in the Middle East and Ukraine, shaky global alliances, and rising inflation, debt, and interest rates. \nWhen we met to record the podcast, Robert said people will look back at the last three decades as a time of “extraordinary peace,” which translated into an environment that was “extraordinarily friendly to investors.”  The tools that investors have come to take for granted, he said, probably won’t work for the next 35 years. \nInstitutional investors need to make peace with the uncertainty hanging over markets. Koenigsberger said he and Mohamed El-Erian, the chair of Gramercy, agree that “Our highest conviction is you can’t have conviction.” Not particularly reassuring, of course. But investors need to accept that volatility isn’t going away and then construct portfolios that use it rather than “get whipped around by it.” \nWhich brings me back to investing in emerging markets, which is an object lesson in how not to deal with uncertainty. Institutions let  well-intended asset allocation rules and governance policies prevent them from being flexible and opportunistic.\nIn episode 23, Koenigsberger told Julie that “If you were Rip Van Winkle and you owned the asset class, it did everything it was supposed to do,” including outperforming. The problem was that investors weren’t earning those returns. The culprit was behavioral mistakes.\nCounterintuitively, investors added emerging markets to their...","thumbnail_url":"https://img.transistorcdn.com/sGbiGXnQa59mCHdT4R21dhwLURlGMJ1i42suZKEbNto/rs:fill:0:0:1/w:400/h:400/q:60/mb:500000/aHR0cHM6Ly9pbWct/dXBsb2FkLXByb2R1/Y3Rpb24udHJhbnNp/c3Rvci5mbS9iNjhk/OWFjYzE0YTljOGYz/ZGMyMDdmNzI5YmNk/MmI3Zi5qcGc.webp","thumbnail_width":300,"thumbnail_height":300}