January was a good month for the FTSE 250. It climbed 3.77%, outstripping the FTSE 100, which itself did pretty well with a 2.74% gain. One FTSE 250 stock I’ve been watching closely really made hay, jumping 35%. It’s name? Specialist emerging markets fund manager Ashmore Group (LSE: ASHM). It caught my eye last year for one simple reason: an absolutely eye-popping trailing dividend yield of more than 10%. Could investors finally bag some growth too?
Ashmore was on my watchlist two decades ago. Back then, emerging markets were booming as investors obsessed over the potential of the so-called BRICs — Brazil, Russia, India and China. After the financial crisis, the BRICs fell from favour and investors drifted away, which proved disastrous for Ashmore.
The shares are suddenly soaring
Its shares idled for years. Even after January’s surge, they’re still trading near a 10-year low. At least long-term investors will have had some dividends to reward their patience.
But those dividends haven’t grown much. In 2015, Ashmore paid 16.65p per share. That’s been increased just once in the past decade, by 1.5% in 2020. In 2025, it stood at 16.9p. Many investors, myself included, will have been tempted by the massive yield, only to see it as a sign of weakness rather than strength.
Last year, emerging markets began to stir as investors finally tore their eyes away from US tech. Ashmore shares edged higher, but progress was slow. Then on 5 January, they spiked.
One reason Ashmore has struggled is that it has exposure to Venezuelan debt, a disaster with the country in economic freefall. But when the US captured that country’s leader Nicolas Maduro, a negative abruptly became a positive for the firm. Markets saw a chance that Venezuela might end years of isolation, with a new government negotiating a restructuring of defaulted debt estimated at $60bn or more.
However, that worries me more than it excites me. If there’s one thing I don’t need in my portfolio, it’s Venezuelan debt. I’ve got enough on my plate with Ocado Group.
Assets finally rising
More encouraging was news on 15 January that assets under management had risen 8% in the second quarter to $52.5bn, driven by $2.6bn of net inflows and a $1.2bn boost from investment performance. That’s far more tempting.
This reflects renewed investor interest in emerging markets and offers a flash of light at the end of Ashmore’s long dark tunnel. The share price is up 41% over the past year, but still down almost 50% over five years.
CEO Mark Coombs said emerging markets now offer stronger economic growth than the developed world, easing inflation and the prospect of interest rate cuts. A weaker US dollar would help too, if that trend persists. He must be relieved to finally deliver some good news after a gruelling decade.
There’s still thumping income on offer, with a trailing yield of 7.1%. But I wouldn’t go as far as to call this a slam-dunk buy. It’s well worth considering for investors who are prepared to accept a high level of risk for higher potential excitement. I’ll be watching Ashmore with fresh interest, but it’s a little too, er, exciting for me.
