3 Pitfalls in Investing in Emerging Markets

Using Quantitative Techniques to Analyze Stocks

3 Themes in Emerging Markets

Identifying Drivers is Important Step in Pinpointing Undervalued Companies

CE Credits Earned in Online Conference

Topics Included Emerging Markets, the Credit Market, Actuarial Matters, and Governance

Factors First: A Risk-based Approach to Harnessing Alternative Sources of Income

Image by Arek Socha from Pixabay 

Staff Report From NUVEEN/Nuveen

The income-generating potential of alternatives seems to be largely underappreciated, despite the trend toward larger allocations to alternative asset classes in institutional portfolios and the quest for yield in a low-rate environment. When we ask institutional investors what roles they look for alternatives to play in a multi-asset portfolio, diversification is the top priority, followed closely by total return. Income generation usually is a distant third.

Institutional investors can enhance their ability to capitalize on the yield and diversification benefits of alternatives by focusing on the risks that drive returns in each specific segment of the alternatives universe. This approach allows investors to stitch together multi-asset portfolios in a more efficient, coherent way.

Executing this, however, is no simple task. If done incorrectly, investors risk negating some of the diversification benefits that make alternatives such valuable contributors to stronger, more resilient portfolios.

Know what risk factors drive return

Alternative asset classes such as private credit, real assets (farmland, timberland and private equity infrastructure investments) as well as non-traditional sectors of fixed income (preferred securities, emerging markets debt, high yield corporate debt and leveraged loans) present attractive income-generating potential.

Idiosyncratic risks play a vital role in driving returns in each of these asset classes — and these risks are what institutional investors should be trying to harness in an income-generating multi-asset portfolio. But it is important to note that each of these asset classes has significant exposure, in varying degrees, to the core, broad-based risk factors: equity, credit spread and rate duration.

As the chart below illustrates, idiosyncratic risks account for less than 60% of the contribution to total risk in all of the alternative asset classes included in the chart, except for real estate. With emerging markets debt, for example, equity risk accounts for 36% of the total risk and credit risk accounts for an additional 33%.

Preferreds are also an interesting case. Some investors consider them to be more like an equity instrument while others consider them to be more like fixed income. This debate is easily settled when viewed through a risk decomposition lens, which shows that equity risk and idiosyncratic risk account for the totality of risk for preferreds.

Click chart to enlarge.

This isn’t to imply that emerging markets debt and infrastructure aren’t valuable diversifiers. Rather, it is to highlight that unless an investor decomposes the risk contributors, a portfolio could end up with significantly more exposure to equity, credit or rate risk than the investor bargained for.

Allocate to risk factors, not asset classes

Investors are compensated for owning risk, not asset classes. We believe that their portfolio construction processes should reflect this and we have developed a five-step approach to do just that:

1. Decompose risk factors driving the performance of asset classes
2. Analyze how the market is compensating those risk factors
3. Determine which risks need to be owned to fulfill investment objectives and constraints
4. Determine which asset classes and vehicles will achieve the desired risk exposures
5. Monitor risk and asset class relationships and how the market is compensating risks

The benefits of a risk-first approach

This framework puts risk at the heart of constructing multi-asset portfolios and delivers multiple benefits to investors. As already noted, it reduces the risk of overconcentration of risk factors in a portfolio, which could undermine the diversification benefits investors seek from alternatives.

It also encourages a more nimble approach to pursuing yield. The relationships among the risk factors and thus the relationships among the asset classes are constantly evolving — and the degree to which the market is compensating various risks is always changing. Predefined asset allocation constraints limit an investor’s ability to exploit these changes and manage risk.

The framework fosters a more nuanced approach to managing liquidity. Liquidity risk is just one of the idiosyncratic risks of an investment. But when using alternatives to generate income and cash flows needed to fund a set liability, liquidity becomes the idiosyncratic risk that institutions need to understand the best. Taking a risk-first approach to multi-asset portfolio construction frees an investor to take a more nuanced and sophisticated approach to managing liquidity risk — not just with alternatives, but across the entire portfolio.

Learn more about harnessing alternative sources of income

The full paper with complete disclosures can be found at Nuveen.com. 

Nuveen is an Associate Member of TEXPERS. The views expressed in this article are those of the authors and not necessarily Nuveen nor TEXPERS. 

Sources
All market and economic data from Bloomberg, FactSet and Morningstar.

On the Horizon: Preparing for a Weaker Dollar Era

Image by Thomas Breher from Pixabay 

By ROBERT M. DALY/Glenmede

Profound shifts in the macro economic, competitive and political environment are converging to create a potentially long-lasting period of weakness for the world’s reserve currency. While many analysts and investors have been debating the potential for a short-term crash of the U.S. dollar (USD), in our view investors should be considering how to prepare for the possibility of a long-term period of dollar weakness.

Recent Depreciation Highlights that Issues are Likely to Linger

After bouncing back from an early March low caused by COVID-19 concerns, the U.S. Dollar Index (DXY) has resumed its slide, dipping approximately ten percent from its mid-March peak and moving toward two-year lows. An analysis of the drivers for this decline shows a multitude of reasons for this trend, including macro conditions, monetary and fiscal policy, trading fundamentals and a structural shift in how the dollar works within the global investment framework. When examining the major U.S. dollar pairs[1], we see four key issues behind the shift in the dollar’s valuation:

Source: Bloomberg. Click chart to enlarge.

1. The 2008 Dollar Shortage no Longer Exists

A myriad of issues makes it hard to argue that the U.S. dollar shortage continues to be an issue, as detailed in a recent GaveKal research report (GaveKal Research: “The US Dollar Starts to Break Down” July 22, 2020). In 2008, the U.S. dollar was the world’s overarching currency, and the United States was one of the only major economies with positive interest rates. During that time, the U.S. current account deficit was between 4-6 percent of gross domestic product. Plus, foreign-domiciled U.S. dollar debt was a legitimate concern during the great recession. In contrast, today interest rates are hovering near the zero lower bound, the current account deficit is widening, and U.S. money supply (M2) is growing at 24.5 percent per year. Additionally, the U.S. Federal Reserve has also opened up swap lines with 14 other central banks. GaveKal Research: “The US Dollar Starts to Break Down” July 22, 2020).

Source: Bloomberg, Bank of Canada, Bank of England and European Central Bank. Click chart to enlarge. 

2. Competition Across the Globe 

A credible alternative to the U.S. dollar may be emerging as the European Union appears to be regaining strength, making it attractive to investors again. In a demonstration of solidarity that Alexander Hamilton would envy, EU members’ decision to jointly issue up to 750 billion euros for the EU’s historic stimulus plan signals reassuring unity for the euro. However, the real question will be whether the European experiment provides a lasting stable fiscal foundation. Overall, we believe the EU developments can change how reserve managers and asset allocators think about their options around the world.

Source: Bloomberg. Click chart to enlarge.

3. Interest Rate Divergence Between China and the United States

China is not monetizing the COVID-19 crisis, while the United States pursues a policy of debt monetization. This difference in monetary policy has the potential to create a stark divergence in long-term interest rates between the countries.

4. The Unpredictable U.S. Political Backdrop

A chaotic U.S. political environment is making a very uncertain construct for the dollar. A divided government, a seeming inability to effectively address the COVID-19 pandemic, tax implications from the stimulus packages, election-year political dynamics and heightened Sino-U.S. tensions are just some of the concerns complicating monetary policy.

In short, we are now in a period of ample liquidity provisioned by the major world’s central banks combined with an uncertain U.S. domestic situation. The investment environment has changed markedly and in ways that are likely to continue for quite some time. 

Broader Implications for Investors

Given these significant and potentially long-term shifts, investors have a number of potential considerations as they map their asset allocation and investing strategies:

1. Inflation Dynamics

The decline in real interest rates against nominal rates completely bounded by the U.S. Federal Reserve has caused U.S. breakevens to rise significantly. While this would suggest a deflationary environment, there is real concern that persistent debt build up coupled with a depreciation in the dollar could create a higher likelihood of inflation as we move into 2021. According to Goldman Sachs (Gold Views: In search of a new reserve currency), the United States’ expanded balance sheet and vast money creation could heighten fears about the value of the dollar. The outcome likely would then be higher inflation but at a surmountable level. We are do not currently projecting anything similar to a 1970s scenario.

2. Gold and Metals

Gold can be a very good hedge in portfolios specifically against inflation. We believe that with real interest rates at all-time lows, an appropriate allocation to gold, as well as other metals such as silver, could make sense for investors.

3. Emerging Markets

A weaker dollar is good for external global growth. We believe that the current dollar dynamic may be a predictor of better returns in emerging markets.

Thinking More Broadly for the Longer Term

The current dynamics may lead to a very different investment environment than we have seen recently. Monetary trends today are supportive to treasury inflation-protected securities, metals such as gold and silver, and emerging markets. Going forward, investors may need to consider a more global construct, looking well beyond the U.S. domestic focus that has dominated the past decade.

While we think about the dollar’s decline and the inflationary scenario that the market is worried about, we don’t perceive these as fundamentally problematic at this time. Real interest rates are the narrative. The driver pushing risk assets is the continued low interest real rate environment. As real interest rates continue to drop, and the dollar declines, risk assets persist as attractive opportunities.

Source: Bloomberg. Click chart to enlarge.

Glenmede Investment Management, LP, is an Associate Member of TEXPERS.The views expressed in this article are those of the author and not necessarily Glenmede Investment Management nor TEXPERS.

Sources:

[1] The major pairs are the four most heavily traded currency pairs in the forex market. The four major pairs are the EUR/USD, USD/JPY, GBP/USD, USD/CHF.

About the Author: 

Robert Daly is Director of Fixed Income for The Glenmede Trust Company, N.A. and Glenmede Investment Management LP. He is responsible for the management of over $4 billion of tax-exempt and taxable fixed income strategies for institutions, consultants and private clients. Daly works closely with a team of traders, portfolio managers, credit analysts and other professionals to broaden exposure to GIM’s fixed income suite. He also serves as a member of GTC’s Investment Policy Committee. 

Prior to joining Glenmede, Daly served as a Senior Portfolio Manager for U.S. and global fixed income strategies at BlackRock in New York. In this role, he was instrumental in establishing and managing a team responsible for asset allocation development, portfolio construction, risk budgeting and formulating investment process. Previously, Daly managed multi- sector and investment grade credit fixed income portfolios for institutional clients. 

Daly earned a Master of Business Administration degree in finance and accounting from Columbia University and his Bachelor of Arts degree in government from Dartmouth College.

BY BLAKE S. PONTIUS, William Blair Investment Management

The January 2019 collapse of a Brazilian mine tailings dam—which released 11.7 million cubic meters of toxic mud, killed at least 150 people, and led to a corruption probe—underscores the critical but underappreciated value of environmental, social, and governance (ESG) considerations in emerging markets.

ESG: More Important in Emerging Markets?

The majority of ESG-aware asset managers surveyed by Citi Research in October 2018 expressed the view that ESG factors are more important in emerging markets than developed markets, particularly from a corporate governance risk perspective.

Generally, weaker corporate governance practices in emerging markets relative to developed markets have played a role in shaping this opinion. More seasoned, quality-focused investors have long appreciated the need to be sharp on governance considerations when investing in frontier countries such as Kenya and Argentina, as well as the more mainstream countries such as China, India, and Brazil.

We’ve seen a variety of environmental and social issues become increasingly relevant to investors.

Emerging markets have more state-owned enterprises, necessitating a higher level of scrutiny of governance practices by prospective investors. While varying across different countries, there is generally a greater prevalence of family founders with majority stakes within emerging markets. Lower rates of board director independence and weaker corporate transparency are other realities contributing to the elevated governance risk profile.

Beyond these more obvious considerations related to governance and business culture, we’ve seen a variety of environmental and social issues become increasingly relevant to investors. From an environmental perspective, combating air, soil, and water pollution is becoming a more significant focus of government policy in China and India. And from a social perspective, investors are increasingly scrutinizing how companies are managing broader stakeholder relationships that can materially impact financial performance.

Back to the Brazilian Dam Disaster

The latter point takes us back to the Brazilian dam disaster.

The resource-intensive energy and materials sectors continue to play an important role in the socioeconomic welfare of many emerging and frontier economies, with concomitant ESG risk factors that can have severe consequences beyond share price performance.

For example, mining companies that operate in environmentally sensitive areas where indigenous populations live have to be thoughtful about how they develop resources. They must also ensure the safety of their employees through ongoing capital investments and training.

Brazil’s Vale SA, which owns the dam that collapsed in Brumadinho, knows that all too well. The company has since announced that it will close all 10 of its dams in the country with a similar design. 

Ratings Reflect Greater Risks, but also Opportunities

These risks can be seen in the ESG ratings distributions of emerging versus developed markets. Conventional ratings distributions, such as the one shown below from MSCI, reflect a negative skew in emerging markets relative to developed markets. (Applying MSCI’s ratings methodology, CCC is the lowest ESG rating assigned to companies on an industry-relative basis and AAA is the best.)

Click graph to enlarge.

This negative skew in ESG ratings reflects some of the risks I discussed above, with a consistent overhang being weaker governance structures for companies across different sectors within emerging markets. Companies lacking a majority independent board, for example, are systematically penalized. The existence of a combined chairman and CEO or dual share classes with unequal voting rights are also detrimental to the rating.

Over time, we expect ESG ratings for emerging market companies to broadly improve as more capital flows into ESG-focused equity and fixed-income strategies, and as more asset managers integrate ESG considerations in traditional strategies.

Emerging market ESG funds now account for nearly 10% of global emerging markets funds, up from just 2% a decade ago, as illustrated below.

Growth of ESG Assets in Emerging Markets

We’ve already seen tremendous growth in ESG-focused emerging markets fund assets, from less than $1 billion in 2008 to $20 billion in 2018, as measured by EPFR and Citi Research. Emerging market ESG funds now account for nearly 10% of global emerging markets funds, up from just 2% a decade ago, as illustrated below.

Asia ex-Japan represents a significant percentage of ESG-focused assets in emerging markets based on data collected by the Global Sustainable Investment Alliance (GSIA), with the largest markets for sustainable investing being Malaysia (30% of total professionally managed assets), Hong Kong (26%), South Korea (14%), and China (14%).

Malaysia’s prominence may come as a surprise considering the high-profile scandal involving its state-owned investment fund, 1MDB. Similarly, China’s inclusion on the list of prominent ESG markets contradicts the conventional perception of weaker governance given the role of state-owned enterprises (SOEs) and environmental mismanagement (ambient air pollution kills hundreds of thousands of citizens every year, according to the Chinese Ministry of Health).

But, perhaps surprisingly, according to a recent biannual review of corporate governance practices in Asia by research firm CLSA, Malaysia was the “biggest mover in 2018,” climbing to 4th place in Asia’s corporate governance market ranking.

And China was the fastest-growing market for sustainable investing from 2014 to 2016, according to the GSIA. Sustainable assets there were up 105%, followed closely by India (up 104%).

Much of that growth was driven by investment opportunities arising from public policy initiatives to clean up the environment, including China’s efforts to improve air quality by working to transition away from coal toward natural gas and renewables.

The views expressed herein do not constitute research, investment advice or trade recommendations, do not necessarily represent the views of William Blair Investment Management nor TEXPERS, and are subject to revision over time.

About the Author:

China A-Shares: Is Your Emerging-Market Manager Ready?

By John Lin, guest columnist

With the celebration of the Chinese New Year last week, investors welcomed the year of China A-shares, soon to be included in the MSCI emerging-market benchmarks. But put careful consideration into determining which funds are actually ready to join the festivities.

Index provider MSCI plans a gradual integration for the vast onshore market, whose $8.3 trillion market capitalization is second only to that of the US. Though A-shares will initially account for just 0.7 percent of the MSCI Emerging Markets Index, it’s a major step toward assimilating China’s vast onshore equity universe into global capital markets. At full inclusion of 500 stocks, A-shares are likely to account for more than 20 percent of the benchmark, according to many sell-side estimates. Over the long term, the index revisions are expected to unleash $100 billion of investment in A-shares through EM vehicles.

Increasing Exposure to Chinese Markets

But are emerging market funds ready for the change? Overseas investment funds have been increasing exposure to China, according to a recent Bloomberg report. Yet even though 87 percent of mutual and index funds invest in Chinese equities—and some A-shares are already accessible—their holdings remain concentrated in offshore H-shares, traded in Hong Kong, and US-listed American depositary receipts, or ADRs.

Click image to enlarge.

Nearly three-quarters of the funds don’t hold any onshore shares. China A-shares account for only $14 billion (or 1.7 percent) of assets under management in emerging market funds (Display, left). And only 10 emerging market funds hold more than 10 percent in onshore equities (Display, right).

There are good reasons to be cautious about A-shares. Investors need to navigate structural imbalances in China’s debt-laden economy, concerns about the government’s macroeconomic stewardship and the large contingent of state-owned enterprises in the market.

Ignoring A-shares, however, means missing the full potential of China’s expansion. For example, the onshore market is full of growing healthcare companies serving the country’s aging generation. Many technology firms from the Shenzhen market are inaccessible offshore. The market also provides access to China’s explosive consumer growth and local brands popular with the growing middle class; shares of Kweichow Moutai, the distiller of a popular grain liquor, more than doubled on the Shanghai Stock Exchange over the last 12 months due to swelling demand.

What Does It Take?

But what does it take to invest effectively in China A-shares? We think three key competences will determine success:

• Boots on the ground—There’s no substitute for research heft. Funds must be armed with field research from professionals with deep experience on the ground in China. These teams need to be fully versed in the nuances of China’s growing economy, know the players inside and outside the companies, and be able to identify firms with good governance. It’s also important to make sure that an EM fund has enough analysts to cover the market effectively.
• Quantitative capabilities—There are more stocks listed in the China A market than in either the Nasdaq Stock Market or New York Stock Exchange. MSCI’s inclusion of 222 A-shares into its EM benchmark increased the number of stocks in the index by more than 25%. Moreover, there are now more than 1,900 A-share stocks accessible to foreign investors through the Stock Connect scheme, more than doubling the universe of investible equities in China. This favors research teams already familiar with the onshore landscape, in our view. We also think funds that know how to combine quantitative tools with fundamental analysis will have an edge when combing the vast pool of A-shares to identify portfolio candidates.
• Active advantages—Research shows that active investing strategies are especially effective in emerging markets, which are less efficient than developed markets. In China’s A-share market, which is dominated by retail investors, inefficiencies abound. These retail investors often lack critical information about company performance, and information dissemination is imperfect. For example, it can take months for the market to respond to sell-side analyst upgrades. This environment favors a hands-on approach that focuses on long-term fundamentals and investment themes.

A-Shares Are Different

Investing effectively requires a thorough understanding of how China’s top-down politics ripples through the economy. Though politicians’ rhetoric can be discounted in Western markets, China’s political class often sets the rules in the market.

For example, the government’s focus on reducing air pollution is creating winners and losers in the transportation industry. A curb on diesel trucks is benefiting Chinese rail operators and vehicle manufacturers that meet emissions standards.

Funds must be able to identify companies with interests that don’t align with minority shareholders. Many state-owned enterprises will prioritize public responsibilities over profit maximization. Meanwhile, professionals need to be familiar with tycoons who might siphon off profits for side projects.

To pilot a portfolio through these challenges, familiarity with the onshore landscape is indispensable. But we think many emerging-market investors may not be equipped with what it takes to find stocks with the strongest return potential. Ask your fund manager the right questions to find out whether they are ready—or not—to fully participate in a new year of opportunities across all of China’s stock markets.

The views expressed do not constitute research, investment advice or trade recommendations and do not necessarily represent the views of all AllianceBernstein portfolio-management teams or TEXPERS.

About the Author

John Lin

John Lin is a portfolio manager for China Equities and also serves as a senior research analyst, responsible for covering financials and real estate companies in China. He joined AllianceBernstein in New York in 2006 as a research associate for US Small and Mid-Cap Value Equities and transferred to the Hong Kong office in 2008. Previously, Lin was an investment-banking associate at Citigroup. He holds a bachelor's degree in environmental engineering from Cornell University and a master's degree from The Wharton School at the University of Pennsylvania.

Investing in the Emerging Millennial Boom

In China, 35 percent of people born in the 1990s is expected to graduate from college,
up from just 4 percent among their parents, according to a Goldman Sachs report. 

By guest columnists Laurent Saltiel, Sergey Davalchenko, Naveen Jayasundaram and Kate Huang

Millennials are becoming a powerful force in emerging markets. Understanding the social and consumer dynamics of this generation can lead to surprising investment opportunities in diverse sectors.

People born in the 1980s and 1990s are coming of age. Commonly known as millennials, this segment of the population is becoming increasingly important as contributors to society and drivers of consumption growth.

Click images to expand.

In emerging Asian countries, the millennial engine is racing ahead. Millennials account for a larger portion of the population (Display 1) and are wealthier in aggregate than their developed-market peers (Display 2). Since they’re often better educated than their parents, they enjoy brighter job prospects. And Asian millennials have vastly different habits and tastes from past generations. Businesses that successfully cater to this generation can enjoy prolonged growth, in our view.

China Leads the Way

China deserves special attention. With 415 million millennials and a relatively high per capita income, spending power of the younger generation in China is much greater than in other emerging countries.

In China, 35 percent of people born in the 1990s is expected to graduate from college, up from just 4 percent among their parents, according to a Goldman Sachs report. Since 70 percent of Chinese millennials already own a home, they have more disposable income than young Americans, who are typically saddled with student loans. It is no surprise that recent surveys show greater optimism about the future among emerging market millennials than their western counterparts.

Private Education Is Booming

Education is a top priority. Owing to cultural norms in Asia, parents spend a disproportionate amount of their income on education (Display 3).

Click image to expand.

China stands out for several reasons. First, as a result of China’s “one child” policy, families are often willing to spend handsomely to ensure their child’s success. Second, the number of high-quality universities is limited. Third, older Chinese millennials who have reaped the benefits of a better education are keen to invest heavily in their child’s future.

Private companies have stepped up to serve needs not addressed by the country’s public school system. Examples include New Oriental Education & Technology Group, a household name in K–12 after-school tutoring in China. Many millennials send their young children to New Oriental’s early-education classes. As they grow older, these kids join the company’s tutoring programs for hypercompetitive exams that are a prerequisite to enter China’s best universities.

Travel Bug Is Spreading

Beyond education, Chinese millennials are also passionate about travel. In 2016, Chinese people aged 18 to 34 made 82 million trips abroad, accounting for 60 percent of the country’s foreign travel and spending more than $150 billion. By comparison, Americans of all ages made 75 million journeys abroad last year. As more young people enter the workforce, we expect Chinese outbound tourism to grow at more than double the global rate over the next five years.

Young Chinese also have travel preferences that are more similar to those of their western peers. For example, over 70 percent of Chinese millennials rely on online resources to plan their trip. They increasingly shun popular destinations like Paris and Tokyo in favor of unique experiences like watching the Northern Lights in Finland. While older Chinese may spend a chunk of their travel budget on a Louis Vuitton bag, Chinese millennials seek to invoke similar envy among their friends by instantly sharing their travel experiences on social media platforms like WeChat and Weibo.

For example, Ctrip.com, the country’s leading online travel agency, serves as a one-stop shop for all travel needs from air and hotel booking to packaged tours and corporate travel. The company is also investing in travel guides and alternative accommodation (like TripAdvisor and Airbnb).

Millennial dynamics vary from country to country. In India, for example, large lenders like HDFC Bank are capturing market share by creating online banking tools that fit the lifestyle of a millennial customer. In Vietnam, shopping mall operators like Vincom Retail are catering to millennials’ preference for modern retail over traditional wet markets and mom-and-pop stores, as well as their desire for international brands and entertainment venues.

For investors, the millennial boom is an exciting opportunity. But it requires a long-term perspective on cultural and consumer nuances of individual markets. By focusing on the constantly changing needs of young people, we believe investors can discover companies poised to benefit from demographic trends that will unfold over a generation or more.

The views expressed do not constitute research, investment advice or trade recommendations and do not necessarily represent the views of all AB portfolio-management teams or TEXPERS.

About the Authors

Sergey Davalchenko

Sergey Davalchenko has been a portfolio manager for Emerging Markets Growth since March 2012. He also served as a portfolio manager on the International Large Cap Growth team from 2011 to early 2017. Before joining AB in 2011, Davalchenko was a senior international analyst at Global Currents Investment Management, a subsidiary of Legg Mason. Prior to that, he worked as a portfolio manager at Fenician Capital Management, where he was a partner. Early in his career, Davalchenko specialized in international equities in various analyst and portfolio-management roles for the State of Wisconsin Investment Board and Oppenheimer Capital. He holds a Bachelor of Science in finance from the University of Wisconsin.

Kate Kuang

Kate Huang is a research analyst on the Emerging Markets Growth team, a position she has held since 2014. Huang was previously a research analyst at Asian Century Quest Capital. Prior to that, she was a senior research associate at AB Bernstein and, before that, a counterparty credit risk analyst at Bear Stearns/JPMorgan Chase. Huang began her career as a counterparty risk analyst at Barclays Capital. She holds a bachelor's degree n economics and statistics from Mount Holyoke College and a master's degree in finance from Columbia Business School.

Naveen Jayasundaram

Naveen Jayasundaram joined AB in 2014 as a research analyst on the Emerging Markets Growth team. He was previously a junior engagement manager in the corporate finance practice at McKinsey. Jayasundaram began his career as a product manager at Microsoft. He holds a Bachelor of Science in electrical engineering from the University of Texas at Austin and a master's degree from the Kellogg School of Management at Northwestern University.

Laurent Saltiel

Laurent Saltiel has been chief investment officer of Emerging Markets Growth since March 2012. He also served as chief investment officer of International Large Cap Growth from 2010 to early 2017. Prior to joining AB in 2010, Saltiel spent eight years at Janus Capital, where he most recently led several international and global growth portfolios. Before that, he worked as a research analyst covering the materials and consumer sectors, as well as a broad range of stocks in Brazil and India. Saltiel was previously a research analyst at RS Investments, where he covered technology and healthcare. Prior to entering the investment business, he spent seven years as a marketing executive at Michelin, where he held full-time roles in Japan, Mexico and his native France. Saltiel holds a bachelor’s degree in business administration from the École Supérieure de Commerce de Paris and a master's degree from Harvard Business School.