Goldman Sachs is wrong to tell its clients to cut their exposure to emerging markets, according to top developing world-focused hedge fund manager.
A recent report from the bank told its wealthy patrons to cut their emerging market exposure by a third. Goldman warned of "the strong possibility of significant under-performance and heightened volatility over the next five to 10 years" because of weak economic and governance structures.
"The case for the structural reforms that need to be done in emerging markets—you could have made the same case 10 years ago. You would have missed a decade of outperformance," said Marko Dimitrijević, head of $2 billion Everest Capital, when asked about the Goldman report Tuesday. "If you reduce or ignore emerging markets, you're going to miss on literally hundreds of companies that are great."