Increasing inflation may be a risk for investors in India, but that market's sentiment-driven volatility can throw up cheap long-term investments for JPMorgan Emerging Markets Equity Fund, which is "overweight" in India.
"In India, we can find businesses we want to own for a long time, (but) inflation there has hurt in the recent past," Thomas Leventhorpe, JPMorgan investment adviser, told Reuters.
India's main gauge of prices - the wholesale price index - rose 8.3 percent in February from a year earlier, well above the 7.8 percent forecast in a Reuters poll.
Despite worries about inflation and infrastructure, the fund's largest holding is in India's Housing Development Finance Corp, at 4.5 percent.
The fund, which is little more than 10 years old, also owns more than 4 million shares in Bharti Airtel, India's largest telecom service provider.
"We have held these for a long time and we expect to hold them for a long time in the future. They have a competitive cost structure and a large addressable market," Leventhorpe said.
With 21 percent of its money invested in Hong Kong and the Chinese mainland - the fund's favorite region - Leventhorpe reckons "China has many opportunities, but also many risks".
"China has done a good job of containing its economy recently. They are not trying to slow the economy ... they are trying to stop a property bubble."
China Merchants Bank Co Ltd and Ping An Insurance Group Co of China Ltd are among the fund's overall top-10 holdings.
Leventhorpe, who joined JPMorgan in 2007, believes a slower-than-expected recovery in US markets has added steam to investments in emerging markets. He said the fund was "overweight" in China.
