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Van Eck Mutual Funds
4/15/14: According to The Wall Street Journal, turmoil in China and Russia have curtailed gains for income-seeking funds. “Look at it from the perspective of a conservative U.S. investor who’s looking for yield,” says David Semple. “You may get your yield in due course, but you’ll get your volatility with that.”View article >>
4/10/14: Despite the hit emerging markets companies have recently taken, some money managers believe there are still worthwhile opportunities. According to David Semple, “There are state-owned businesses that deserve to trade at discounts, but you can find real growth stories that sell at reasonable prices.”View article >>
12/05/13: CNN Money polls money managers for top stock ideas for 2014. David Semple weighs in and discusses his views on oil demand in Southeast Asia. “Oil demand from this region is clearly very strong, and this company seems to be at the center of it.” View article >>
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By: David Semple, Portfolio Manager
Fund's recent performance >>
The Van Eck Emerging Markets Fund gained 4.96% in the second quarter.
Emerging markets outperformed the broad U.S. market in the
second quarter of 2014, an event we’ve not seen for some time.
Flows returned to the asset class, especially in April and May
of 2014, which became the two months with the highest flows
since March of last year. China continued to underperform its
emerging market peers. In India, we believe historic elections had
a positive effect on the Indian stock market. And the Russian stock
market rebounded later in the second quarter, as Ukraine tail risk
dissipated somewhat, but was not irrelevant.
Our Fund allocation is still overweight China and India, as we believe
valuations remain compelling in both countries, although a little less
so in India, now that the election fervor there has faded. As usual,
there is a wide range of opinions, and great deal of skepticism about
the China story. What is clear is that there is a continuing tug of
war between significant positive and negative economic variables.
However, there is continued evidence of Chinese reform, and we
believe the ongoing modest stimulus is expected to continue and
keep growth above the 7% to 7.5% level. Despite all that, let’s not
forget about the secular growth story in China, which now has the
largest e-commerce economy in the world.
We approach the balance of 2014 with optimism. In our view,
the global economy could continue to accelerate gradually.
Monetary conditions may also tighten eventually, but could remain
accommodative, and valuations generally remain attractive.
Emerging markets were considered unattractive at the start of
the year, but we feel that the tide is turning. And while not many
investors could be described as unreservedly bullish on the asset
class, the degree of pessimism appears to have abated.
We don’t think that we will see aggregate earnings upgrades, but
in our view we are quite confident that the downgrades may be
substantially less than in the previous three years.
We maintain our selective optimism on China. We are encouraged
by the reform process which may give China a chance of lower,
but better quality, growth. The Fund has benefitted substantially
from stock selection in China in the last three years, although the
last two quarters have been more challenging. Our active style
allows us to target specifically the most appealing aspects of the
Chinese growth story and avoid the unattractive, legacy (often
state owned) companies that dominate the indices.
Read full 2Q Commentary
Portfolio Manager, Van Eck Emerging Markets Investment Team
View now »
Portfolio Manager, Van Eck Emerging Markets Fund
The expansion of domestic consumption, currently a main driver of growth potential, continues to foster a strong case for investment in the emerging markets.
Emerging Markets Defined
The term “Emerging Markets” is typically used to describe business and market activity in industrializing or emerging regions of the world. An “emerging market country” is any country that has been determined by an international organization, such as the World Bank, to have low to middle economic activity. Emerging markets often have unique economic fundamentals and cycles.
Long term, an allocation to emerging markets may provide diversification benefits as emerging markets tend to be less correlated to traditional asset classes than their developed market peers. Read more >>
Unless otherwise stated, portfolio facts and statistics are shown for Class A shares; other classes may have different characteristics.
†NAV: Unless you are eligible for a waiver, the public offering price you pay when you buy Class A shares of the Fund is the Net Asset Value (NAV) of the shares plus an initial sales charge. The initial sales charge varies depending upon the size of your purchase. No sales charge is imposed where Class A or Class C shares are issued to you pursuant to the automatic investment of income dividends or capital gains distributions. It is the responsibility of the financial intermediary to ensure that the investor obtains the proper “breakpoint” discount. Class C, Class I and Class Y do not have an initial sales charge; however, Class C does charge a contingent deferred redemption charge. See the prospectus and summary prospectus for more information.
1Van Eck Associates Corporation (the “Adviser”) has agreed to waive fees and/or pay Fund expenses to the extent necessary to prevent
the operating expenses of the Fund (excluding acquired fund fees and expenses, interest expense, trading expenses, dividends and
interest payments on securities sold short, taxes and extraordinary expenses) from exceeding 1.60% for Class A, 2.50% for Class C,
1.00% for Class I, and 1.10% for Class Y of the Fund’s average daily net assets per year until May 1, 2015. During such time, the
expense limitation is expected to continue until the Board of Trustees acts to discontinue all or a portion of such expense limitation.
2The Morgan Stanley Capital International (MSCI) Emerging Markets Index, calculated with dividends reinvested, captures 60% of the publicly traded equities in each industry for approximately 21 emerging markets. The Morgan Stanley Capital International (MSCI) Emerging Markets Small Cap Index, calculated with dividends reinvested, targets companies that are not in the standard emerging markets index.
The views and opinions expressed are those of Van Eck Global. Fund manager commentaries are general in nature and should not be construed as investment advice. Opinions are subject to change with market conditions. Any discussion of specific securities mentioned in the commentaries is neither an offer to sell nor a solicitation to buy these securities. Fund holdings will vary.
You can lose money by investing in the Fund. Any investment in the Fund should be part of an overall investment program, not a complete program. The Fund is subject to the risks associated with its investments in emerging markets securities, which tend to be more volatile and less liquid than securities traded in developed countries. The Fund’s investments in foreign securities involve risks related to adverse political and economic developments unique to a country or a region, currency fluctuations or controls, and the possibility of arbitrary action by foreign governments, including the takeover of property without adequate compensation or imposition of prohibitive taxation. The Fund is subject to risks associated with investments in debt securities, derivatives, commodity-linked instruments, illiquid securities, asset-backed securities, CMOs and small or mid-cap companies. The Fund is also subject to inflation risk, short-sales risk, market risk, non-diversification risk and leverage risk. Please see the prospectus and summary prospectus for information on these and other risk considerations.
Investing involves risk, including possible loss of principal. An investor should consider investment objectives, risks, charges and expenses of the investment company carefully before investing. The prospectus and summary prospectus contain this and other information. Please read them carefully before investing.
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