Emerging markets are having quite the year. MSCI's emerging markets index delivered a 30% gain through 2025, handily beating the S&P 500 and even outperforming the Magnificent Seven tech stocks—a notable achievement given the trade uncertainty shadowing the region. Tariff threats loom over several key emerging economies, yet the index still managed to capture significant upside. It's a reminder that diversification across emerging markets can sometimes outpace concentrated bets on mega-cap US tech. The question investors are asking: how sustainable is this outperformance? Understanding what's really driving these emerging market gains matters for anyone thinking about portfolio allocation in a potentially fragmented global economy.