Net sales figures from Winterflood Securities show that six months back, Global Emerging Markets lagged behind Property, Global Bonds, and North America. Sales hit around £140m in October 2009.
And looking over the full two year period, Winterflood notes that there has been a large issuance of subscription shares in investment trusts, especially in the emerging market and Asian sectors.
"Investors certainly flocked to emerging markets last year, with many eager for exposure to large cap companies. That means there has been a naturally high exposure to the BRIC countries," investment trust analyst at Oriel Securities Tom Tuite-Dalton says.
"Flows also seemed to be strong into Asia and Latin America, while emerging Europe and Russia lagged behind, so that is likely where investors will see value this coming year," he adds.
Tuite-Dalton adds that investors should look away from the more obvious BRIC countries, and aim for investment trusts that spread their holdings in order to diversify risk.
But an announcement from JP Morgan Asset Management last month that it plans to launch an investment trust to invest solely in Brazil – with a target size of £50m – shows it, at least, still thinks there is value to be had for investors in BRIC. JP Morgan also has closed-ended vehicles in China, Russia and India.
Winterflood, meanwhile, says investment trusts offer good exposure to emerging markets, particularly in the Asia Pacific region, and the Asia Pacific ex Japan sector in particular.
"There are more funds in this strategy than others, and all have assets of more than £100m," Winterflood analyst James Brown says.
Within those funds, Brown picks out Financial Express One Crown rated Henderson TR Pacific, which has the highest exposure to China and Hong Kong; 49 per cent. It is also one of the highest performers within the sub-sector over a one, three and five year period, according to data from the Association of Investment Companies (AIC).
| Fund | Sector | 1-yr | 3-yr | 5-yr | 10-yr |
| Aberdeen Asian Income |
Asia Pacific ex Japan | 149.36 | 148.07 | ||
| Aberdeen Asian Smaller Companies | Asia Pacific ex Japan | 192.74 | 142.76 | 208.91 | 484.21 |
| Aberdeen New Dawn |
Asia Pacific ex Japan | 186.5 | 151.6 | 234.3 | 471.43 |
| Edinburgh Dragon |
Asia Pacific ex Japan | 164.82 | 158.24 | 253.71 | 214.58 |
| Fidelity Asian Values |
Asia Pacific ex Japan | 180.13 | 155.87 | 251.28 | 176.97 |
| Henderson Far East Income | Asia Pacific ex Japan | 148.13 | 149.75 | 197.81 | 495 |
| Henderson TR Pacific | Asia Pacific ex Japan | 166.82 |
145.15 | 225.86 | 161.2 |
| INVESCO Asia |
Asia Pacific ex Japan | 162.65 |
147.23 | 242.63 | 201.42 |
| JP Morgan Asian |
Asia Pacific ex Japan | 149.57 | 130.4 | 208.22 | 169.77 |
| Pacific Assets |
Asia Pacific ex Japan | 155.98 | 124.42 |
209.61 | 164.6 |
| Pacific Horizon |
Asia Pacific ex Japan | 172.03 | 116.57 | 210.3 | 306.32 |
| Schroder Asia Pacific |
Asia Pacific ex Japan | 165.61 | 137.16 | 210.54 | 221.53 |
| Schroder Oriental Income | Asia Pacific ex Japan | 192.19 | 136.04 | ||
| Scottish Oriental Smaller Companies | Asia Pacific ex Japan | 206.67 |
156.96 | 250.13 | 638.12 |
| Weighted Average | 166.56 | 143.32 | 222.61 | 228.33 |
"This [exposure to China] is not surprising as the manager [Andrew Beal] is very positive on the prospects for China and invests with a clear growth strategy. Also unsurprisingly, at the other end of the spectrum are the funds managed by Aberdeen Asia, a fund management group with a well defined quality value style," Brown says.
The Henderson trust, which has a 46.4 per cent weighting in financials, and a 17.5 per cent weighting in TMT, took on more risk that its sector, but returned less to investors over a one year period. It took on 25.5 per cent volatility, returning 72.9 per cent, compared to 20.5 per cent risk and 77.1 per cent returns from the sector.
Other funds were less volatile, meanwhile. The Aberdeen Asian Smaller Companies trust took in 17.3 per cent risk, and returned 99.5 per cent over a one year period.
Financial Express data shows that the three year picture is somewhat different; the Baillie Gifford Horizon trust took on most risk for least return, while the Aberdeen Asian Income took on least risk over the period between 31 March 2007 to 31 March 2010.
Asia Pacific ex Japan sector, 3yr
Source: Financial Express Analytics
Exhibiting perhaps the best blend of risk and reward was the Edinburgh Dragon trust, which returned 64 per cent over the period against risk of about 27 per cent. This £420m vehicle, managed by Aberdeen has a Two Crown rating from Financial Express, and is somewhat focused on the TMT and high tech opportunities in the region - holdings such as Samsung, Infosys Technologies and China Mobile.
As always, investors should look for opportunities beyond the obvious, as in the case of a collective investment portfolio such as Edinburgh Dragon, which blends elements of the BRICs, Emerging Markets and developed Asian markets such as Korea.