The Zhitong Finance App learned that emerging markets are expected to become Wall Street's darling starting in 2026, and asset management agencies are betting that a round of capital inflow cycle that has continued for many years has already begun. The amount of capital poured into the sector this year — covering all emerging market securities and the best performance since 2009 — shows that more and more investors are reallocating to this asset class, which has been underperforming for many years and has not been popular for a long time. Emerging market stocks have outperformed US stocks for the first time since 2017. Interest spreads between emerging market bond yields and US Treasury bonds have narrowed to their lowest level in 11 years, and arbitrage trading strategies — usually borrowing low-yielding assets and buying high-yield assets — have also achieved the best returns since 2009.

The Zhitong Finance App learned that emerging markets are expected to become Wall Street's darling starting in 2026, and asset management agencies are betting that a round of capital inflow cycle that has continued for many years has already begun. The amount of capital poured into the sector this year — covering all emerging market securities and the best performance since 2009 — shows that more and more investors are reallocating to this asset class, which has been underperforming for many years and has not been popular for a long time. Emerging market stocks have outperformed US stocks for the first time since 2017. Interest spreads between emerging market bond yields and US Treasury bonds have narrowed to their lowest level in 11 years, and arbitrage trading strategies — usually borrowing low-yielding assets and buying high-yield assets — have also achieved the best returns since 2009.