From US Dominance to Global Dispersion: Nick Rohatyn on the New EM Cycle

Send us Fan MailNick Rohatyn is the founder and CEO of The Rohatyn Group, and one of the architects of emerging markets as a modern asset class. Having built JP Morgan’s emerging markets business from an eight-person desk into a 600-person global platform, Nick has spent more than four decades investing across cycles, crises, and continents. In this return episode, he reflects on why emerging markets may finally be entering a new phase after more than a decade of underperformance, and why dispersion, not beta, will define returns going forward.In this episode we cover:(00:00:00) Nick’s journey into emerging markets From JP Morgan’s early derivatives desks and a formative stint in Tokyo to discovering emerging markets through Mexico’s debt restructuring and the Brady Plan, and why solving large systemic problems can be both profitable and meaningful.(00:08:40) The three phases of emerging markets as an asset class Strong outperformance from 2002–2011, a brutal 13-year underperformance driven by US exceptionalism, and why 2025 may mark the start of a new cycle as capital slowly diversifies away from the US.(00:14:59) Push and pull factors reshaping global capital flows How US political uncertainty, dollar dynamics, and eroding assumptions about American exceptionalism are pushing allocators outward, while policy shifts, trade realignment, and regional themes are beginning to pull capital into select emerging markets.(00:21:49) Why benchmarks fail and why multi-asset EM investing matters How MSCI and debt benchmarks distort exposure, why single-asset mandates perform poorly in emerging markets, and why the future lies in flexible, multi-asset strategies that move across equities, debt, currencies, and private markets.(00:34:48) Extreme dispersion as the defining opportunity Why countries like Korea and Turkey can diverge wildly in the same year, how geopolitics, interest rates, and underinvestment amplify volatility, and why skilled active managers can thrive in this environment.(00:25:32) Private credit, local capital, and development Why underpenetrated credit markets in Latin America and parts of Africa offer compelling opportunities, how domestic pension systems are becoming critical sources of capital, and why local-currency investing changes the game.(00:43:01) Doing well by doing good at scale Rohatyn Group’s work in sustainable forestry and agriculture, why real assets matter for climate and food security, and Nick’s advice to young professionals seeking careers that combine finance, impact, and global relevance.Find us on Apple, Spotify, Amazon, and Youtube.