How has the subprime mortgage meltdown affected Global Emerging equity markets?

The market volatility caused by the implosion of the subprime mortgage market is a classic bubble that emerging market portfolio managers view as a normal, healthy correction in the market. Many emerging market stocks have been hit indiscriminately as a result of the increase in risk aversion. Unlike many U.S stocks which have direct exposure to the subprime issues, such as certain financial institutions, or indirect exposure such as homebuilders and consumer related stocks, almost no emerging companies have direct exposure to these issues. Emerging market growth remains self-funded, there is ample liquidity in these markets, their economies are stronger than they ever have been, corporate profits and balance sheets remain robust. Our analysts are reviewing their top rated stocks and upgrading those that, following recent declines, now present even more attractive investment prospects. As portfolio managers we try to take advantage of such periods of short-term volatility and we are finding many good buying opportunities during this period. We have followed this approach in previous corrections and our relative performance as the market readjusts upwards has been strong. Our investment approach and our view on the markets have not changed because of these recent events.
Given emerging market’s strong advance over the past several years, we are not surprised by this correction in a long-term bull market. Nonetheless, we are encouraged by the relatively healthy global economy and the wide range of appealing investment opportunities present in today’s market. We believe that quality stocks are currently selling at an attractive price, and our objective is to identify stocks with good valuations, reasonable upside potential, and relatively limited risk.