As most of the investor community is aware by now, one the most distinguishable consequences of Donald Trump's presidential election has certainly been the sell-off in emerging markets.
Under the view that a U.S. government spending splurge may accelerate domestic growth and inflation, funds all across the world have started reducing their positions in local currency EM bonds, which suffered their biggest losses last week since 2008.
Currency markets all across the developing world have shown a tremendous correction as well, with the Mexican peso plunging 12% to a record, while the Brazilian real and South Africa's rand have lost more than 7.8% each.
And this rout is likely to deepen. If acted upon, Trump's protectionist overtures would certainly slow exports from and reduce investments to developing economies. For now, these markets have not found a bottom. If we take iShares MSCI Emerging Markets ETF (NYSEARCA:EEM), the correction