Top emerging market funds: Asian chip stocks are the best hedge against the Iran conflict

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As the ongoing Iran conflict continues to disrupt global markets, an emerging market equity fund that outperformed 96% of its peers over the past year has made a clear determination: high-end Asian technology stocks, especially chip manufacturers related to artificial intelligence, are the most defensive asset category in the current geopolitical risk environment.

The Robeco Emerging Stars Equities fund allocates over 40% of its assets to Asian chip stocks such as those from Korea. The fund’s portfolio manager, Jan de Bruijn, stated that even if the global economy falls into recession, these chip companies—thanks to their highly monopolistic position in key market categories—still possess strong ability to pass on costs, and their pricing power is difficult to shake.

According to data compiled by Bloomberg, the fund had $4.6 billion of assets under management as of the end of February, with a 45% return over the past year, and a 6.8% return so far in 2026. Against the backdrop of Asian chip stocks outperforming the regional benchmark this year, the fund’s heavy allocation has locked in this source of excess gains ahead of time.

Monopoly Structure Gives Chip Stocks Pricing Moat

In de Bruijn’s view, the core investment logic of Asian chip companies is rooted in the pricing power that comes from structural monopoly. “AI won’t disappear just because of a global recession,” he said in an interview.

Korean companies have a market share of about 80% to 90% in high bandwidth memory (HBM) chips. De Bruijn pointed out that such a highly concentrated market structure means these companies can pass a considerable portion of costs onto downstream customers.

Against the backdrop of the Iran conflict triggering risk-off sentiment and global economic outlook becoming increasingly uncertain, demand for high-end chips from AI infrastructure construction is seen as highly rigid, forming an important basis for the above judgment.

Discounted Holding Company Strategy Enhances Valuation Cost-Effectiveness

The fund also employs a “proxy trading” strategy, indirectly gaining exposure to target assets by purchasing shares of holding companies, whose market prices are often at a discount of up to 60% relative to their net assets.

Accordingly, the fund chooses to hold SK Square rather than directly hold SK Hynix; hold Naspers rather than directly hold Tencent Holdings. De Bruijn stated, “Sometimes you find a holding company that owns equity in an enterprise, and when you sum up the valuations, you realize you are buying into the investment story at a substantial discount. We believe this discount will shrink over time.”

This strategy enables the fund to maintain exposure to quality tech assets while entering at relatively low valuations, improving the overall portfolio’s margin of safety.

Risk Warning and DisclaimerMarkets are risky, and investment requires caution. This article does not constitute personal investment advice and does not take into account the individual investment objectives, financial situation or needs of any particular user. Users should consider whether any opinion, viewpoint, or conclusion in this article fits their specific situation. Investing based on this is at your own risk. ```