Drop in on any chief investment officer in the western world: while the accents change, the refrain doesn't. Money managers enthuse about a fundamental shift under way, a transfer of power from developed to emerging economies.

Investors seem to be buying it. First-quarter net inflows into emerging markets-focused funds were $3.2bn, versus net outflows in developed markets of $59bn, according to EPFR, which tracks about $11,000bn in total assets. The FTSE All-World Emerging Equity index is up 8 per cent this year, versus a 7 per cent fall in the Developed index.

Decoupling, in short, is back. But does this kind of geographic diversification actually work, as an investment strategy? Historically, no. The relationship between the Emerging and Developed indices has steadily strengthened since the early 90s.