TT International and AllianceBernstein are making contrarian bets as emerging markets face their worst performance since 2022. The asset managers are targeting beaten-down securities including emerging-market bonds, betting that central banks will cut interest rates rather than raise them to combat a looming growth shock.

This strategy gained traction after Pacific Investment Management Co. highlighted "opportunities to invest against the prevailing narrative." The approach runs counter to conventional wisdom that emerging markets suffer when developed economies tighten monetary policy. Instead, these firms see value in assets that have been oversold amid global economic uncertainty.

The timing is notable as emerging markets typically outperform when developed economies cut rates. By positioning early, these managers aim to capitalize on potential rebounds before broader market recognition. The strategy reflects growing conviction that global growth concerns will force central banks into accommodative policies despite inflation risks.