Beware of 'recency bias' with EM concerns - Morningstar

"From a behavioural perspective, a ‘recency' or ‘vividness bias' is dangerous for advisers and investors," said the Morningstar Investment Management chief investment officer. This, Kemp explained, was the tendency to react with financial headlines and forget investment fundamentals. "You immediately forget what's good about emerging markets," he said. "You focus on the risk and try to trade through it." "In these situations it's important to have an anchor and for us that's valuations." Morningstar's portfolios had been overweight in emerging markets for the past three years bu...