The 2024 Indian general elections, held in early June, brought unexpected political shifts as the Bharatiya Janata Party (BJP), led by Narendra Modi, failed to secure an outright majority, defying predictions. This political uncertainty triggered a sharp sell-off in Indian markets, with the BBG India index dropping 7.2%, largely driven by foreign institutional investors offloading stocks amid concerns over the country’s political stability.

Despite this volatility, the LBRTY® Emerging Markets strategy outperformed during the election week, posting a 3.3% return compared to the EM benchmark’s 1.6%. This success was driven by the strategy’s focus on companies with lower Authoritarian Exposure (AE), which outperformed those with higher AE during the market downturn. By minimizing exposure to autocratic regimes, LBRTY® was able to mitigate the election-driven risk, positioning investors to benefit from the eventual market rebound as political stability returned.