Oppenheimer Developing Markets Fund posted positive results for the first half of the year yet still underperformed its benchmark.
We missed the rebound in commodities because of our structural underweight in that sector, which resulted in uncomfortable relative performance and disappointment among the team. Additionally, emerging market equities were significantly down at the beginning of the year, though they did rebound from late-January to late-April.
Still, we remain steadfast in our approach to investing in the developing world, despite a disappointing start to the year. Though global financial markets are enormously volatile at the moment, we continue to believe that there is a powerful structural case to fundamental investing in emerging markets. Our approach remains anchored in a concentrated portfolio of structurally advantaged businesses with sustainable competitive advantages and growth options, which we believe the market fails to appreciate adequately. We feel that our track record is a compelling testament to this approach.
For more, read our detailed first half performance review of the Fund.
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Special Risks: Foreign investments may be volatile and involve additional expenses and special risks, including currency fluctuations, foreign taxes, regulatory and geopolitical risks. Emerging and developing market investments may be especially volatile. Eurozone investments may be subject to volatility and liquidity issues. Investments in securities of growth companies may be volatile. Mid-sized company stock is typically more volatile than that of larger company stock. It may take a substantial period of time to realize a gain on an investment in a mid-sized company, if any gain is realized at all. Investing significantly in a particular region, industry, sector or issuer may increase volatility and risk.
Mutual funds are subject to market risk and volatility. Shares may gain or lose value.
These views represent the opinions of OppenheimerFunds, Inc. and are not intended as investment advice or to predict or depict the performance of any investment. These views are as of the publication date, and are subject to change based on subsequent developments.