Emerging-market shares may dip 15%

NEW YORK - Emerging-market stocks will drop as much as 15 percent this year as earnings miss estimates and global growth slows, said Devan Kaloo, who oversees $22 billion at Aberdeen Asset Management Plc.

Kaloo, Aberdeen's head of global emerging markets, said he was holding fewer Chinese stocks than were represented in the benchmark MSCI Emerging Markets Index because the government's stimulus program may lead to a banking crisis. Kaloo said he's "overweight" on stocks in Mexico, India and Turkey, "neutral" on Brazilian equities and "underweight" in Russia.

"The markets will see a correction this year," Kaloo, whose Aberdeen Emerging Markets Institutional Fund has beaten 93 percent of competitors in 2010, said. "People get over-optimistic and expect too much out of earnings and global growth."