City AM's Calder backs European small caps as rally continues into 2014

Asset allocation decisions have been particularly challenging for wealth managers this year, as market sentiment turned on worries about the impact of QE tapering in the US. In a complete reversal from earlier in the year, Asian and emerging markets have significantly lagged developed equities as investors were spooked by Ben Bernanke’s pledge to begin pulling back the Fed’s asset purchases. The MSCI Emerging Markets index is down 3.5% over the year to 29 November as a result, while MSCI Europe ex UK has rallied 22.2% and MSCI USA is up 26.7%. James Calder, research director at Cit...