Pension investors should look past 'simple market narratives' when investing in emerging markets (EM), according to Premier Milton fund manager, Will Scholes.

Addressing a session at the Pensions and Lifetime Savings Association’s Investment Conference 2024, Scholes and Premier Milton fund manager, Fiona Manning, primarily discussed investment opportunities in China and India.

“We’re not sitting here to try to tell you to invest solely in China and not in India,” Scholes said.

“Simply to remind, the market loves a simple narrative. It loves a simple narrative around India and China, and India does have challenges ahead of it in terms of providing low-end jobs to bring the bottom of the pyramid up before it can solely offer high-end jobs.

“There is an investment in skills that China has made that is not going to be toppled by issues currently in terms of growth slowdown, rebalancing the economy or the property sector, and that will continue to offer up opportunities for long-term investors, at the moment at very discounted valuations.”

Attendees were polled during the session on their plans for EM investment, with 42 per cent revealing that were planning to increase their allocations to EM equities.

Pension investors were urged to focus on sustainable opportunities when investing in EM.

However, while nearly half of the room were planning to increase their EM investment, less than a quarter were considering increasing their allocations to sustainable EM strategies specifically.

“Our reminder to you all is to look past simple market narratives and focus on sustainable opportunities,” Scholes concluded.

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