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Market view | Emerging markets Forming new ties


BRIC countries still hold their allure but as Dina Medland reports, investors are looking to connect to a wider group of emerging markets.


Emerging markets are jostling for centre stage. The BRIC moniker has served its purpose as a means of identifying disparate countries with strong growth potential, but different dynamics at play. Amid slowing economic growth in China and Brazil, political uncertainties in Russia and huge infrastructure and political paralysis in India, investors remain keen to hunt for the next story. The focus is subtly shifting from Russia to


Eastern Europe and from Brazil to a wider Latin America – with Asia ex-Japan not far behind – and the ‘exotic connections’ of yesterday are becoming the de rigueur ones of today. Linking to these markets though is not always easy as latency, connectivity and market infrastructure in general vary across the different regions.


Philippe Carré, global head of connectivity for SunGard’s capital markets business, responsible


for the delivery of hosted services and solutions to trading clients on both the buyside and the sellside, says, “There is a big story on the margins of Europe from the Baltics all the way to Turkey. Russia has highly developed infrastructure and is an emerged market wearing the cloak of an emerging one and might be on the verge of cleaning up its political act. We are seeing stock- picking investors going to Indonesia and the other Asean nations in which it is becoming easier to trade. In Latin America both Mexico (see p.55) and Brazil attract strong interest from asset managers and although the overall market is somewhat fragmented, there is talk of co-operation and we could see a grouping of exchanges along the lines of Euronext in Europe.” Such a grouping may not happen for some time yet, but there are signs of a trend towards


“In countries like Brazil, more brokers want to gain access to other brokers – the ones who are members of the BM&F Bovespa – while the biggest banks will connect directly.” Chris Pickles, BT Radianz


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Best Execution | Autumn 2012


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