Greece and Turkey emerging as more sheltered options

By Tim Sharp
Where do you invest when stock markets are choppy? The unlikely answer for Citywire AAA-rated New Star Global Financials manager Guy de Blonay is Turkey, Greece, Brazil and Russia.

While emerging markets are usually regarded as risky markets, Mr de Blonay reckons they are sheltered from problems involving defaults on sub-prime loans in the United States that have damaged banks in many developed markets.

Mr de Blonay said: "Our best performance is coming from parts of the world with no sub-prime exposure. I am seeing good growth from Greece which has a long-term growth cycle, and peripheral markets like Russia, Montenegro and Serbia."

He had recently increased his exposure to National Bank of Greece and Bank of Cyprus. "Cyprus is a favourable market for Russians to do business in. Brazil is also interesting and its economy is booming. Turkey is also cheap for an emerging market and while the Chinese market has exposure to sub-prime, it is a huge market and has a life of its own." He adds that investors might retain confidence in the banking and wider financial sectors once companies announce their financial results for the third quarter of the year.

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