Net Net: Promoting innovation and managing change
Net Net: Promoting innovation and managing change

Top mutual fund managers push emerging markets

A large construction project in Tianjin, China.
Zhang Peng / Contributor | LightRocket | Getty Images

Emerging markets got plenty of love from top mutual fund managers at the Morningstar Investment Conference in Chicago this past week.

"We are extremely enthused about what's happening in the emerging world today," David Herro, manager of the $31 billion Oakmark International Fund, said during a panel discussion before nearly 2,000 investment advisors and other attendees.

"As people move from lower class to middle class, middle class to upper class, the impact that has on global consumption and global economic growth," Herro said, citing China and India as examples. "Clearly what's happening in emerging markets in our view is very, very positive."

Read MoreChina 'most durable growth story': Fund pro

Herro said he looks for companies with exposure to those growing consumption trends. His fund's top holdings include apparel and accessories group Kering; beverage company Diageo; and agricultural and construction equipment CNH Industrial.

Robert Lovelace, a portfolio manager for the American Funds, was another emerging markets bull.

"When you cut through it, you will find that there are companies in the developing world that are trading at multiples similar to the rest of the world. But there are quite a few that I think have been caught up in the negative sentiment where people are still looking at the country and doing country analysis and missing the fundamentals of the company," Lovelace said at the conference.