Article: Active U.S. Emerging Markets Equity Managers Outperform in Q3

Brendan Cooper | October 25, 2022

Q3 2022 Manager Research: U.S. Equity Performance Trends

Investment Metrics’ Q3 2022 Manager Research found that despite several headwinds, active emerging markets equity managers delivered stronger relative performance than their developed market counterparts. In this report, we spotlight active Non-U.S. equity manager’s performance as of September 30th 2022, based off the 10th business day preliminary data of IM Peer Groups. 

Summary of Active Equity Manager Performance

  • Active International Large Cap equity managers delivered similar relative performance to U.S. Large Cap equity, underperforming by 20 basis points during the quarter.
  • Active Global Large Cap managers also struggled during the quarter, underperforming by 80 basis points.
  • Active Emerging Markets Large Cap managers delivered the strongest relative performance, adding 1% during the month of September.

Active Non-U.S. Equity Median Performance by Capitalization

Figure 1: Non-U.S. large cap equity median excess returns, periods ending September 2022

As noted in the September 2022 Factor Performance Report, emerging markets equities continued to face headwinds as commodities dropped sharply in the third quarter triggered by a combination of a multi-decade high in the US dollar, growing fears of a global recession, and falling oil prices which all combined to offset hopes for a continued economic reopening in China. Despite this environment, active emerging markets equity managers’ relative performance to the benchmark rebounded. Though absolute returns remained negative, (MSCI Emerging Markets Index returned -11.42%) 76% of active managers in the IM Emerging Markets Large Cap Equity universe outperformed the index in September, with the median adding 1%.

Figure 2: IM Emerging Markets Equity Top Performers Characteristics Q3 2022

Figure 5 above shows the characteristics for the products with top quartile and above median performance in the broad IM Emerging Markets Equity peer group during the quarter. Active fundamental managers’ accounted for over 72% of the products with above median performance. On a style basis, Core & Growth styles combined to account for 81%, while small cap and quality focused products also performed well.

 About Manager Research

The Manager Research is a comprehensive, easy-to-use analytical tool for evaluating asset managers and analyzing investment performance. It simplifies investment research and analysis with instant access to a powerhouse of decision-support information on institutional and retail investments. 


The material presented in this document is an assessment of the market environment as of the date indicated; is subject to change; and is not intended to be a forecast of future events or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding any funds or any issuer or security or similar. 

This document contains general information only, does not consider an individual’s financial circumstances and should not be relied upon for an investment decision. Rather, an assessment should be made as to whether the information is appropriate in individual circumstances and consideration should always be given to consult a Financial Advisor before making an investment decision.  

Investment Metrics does not provide investment advice and nothing in this document should be considered any form of advice. 

Investment Metrics accepts no liability whatsoever for any information provided or inferred in this document. 


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