Economic Exposure to Emerging Markets

May 30, 2012

As companies increasingly operate across multiple countries and regions, we consider the concept of "economic exposure" which may be derived from the geographic distribution of a company's revenues. This concept offers a new dimension to the construction and evaluation of global equity portfolios and may serve multiple purposes in the investment process - including macro view implementation, security selection, portfolio analysis, risk management and client reporting. Furthermore, a company's economic exposure may serve as a complementary or an alternative definition of the country factor that is typically derived from its country of domicile and primary listing.