Vanishing value trade puts emerging markets at risk of Fed shock

NEW YORK: The Federal Reserve’s (Fed) most aggressive policy tightening in two decades is sucking emerging markets (EMs) into a “sell everything” slump, not even sparing assets that should do well when interest rates rise.

Take value stocks. Shares of mature companies with high dividends and cheap valuations are finding a bid in the United States and Europe, where investors are switching to them from more expensive equities in fast-expanding sectors like technology.