Almost a decade after being battered by the Asian financial crisis, emerging market investors are getting a worrying reminder about political risk from the streets of Budapest to the barracks of Bangkok.
This time, however, they reckon things are different and lessons have been learnt. Greater diversification and more sophisticated scrutiny of assets mean global investors are better able to cope with sudden surprises in any one country.
The risk of contagion one crisis spreading across borders to create an even bigger one is, accordingly, seen as small.
A number of investors even see immediate knee jerk falls in Thai baht and bond prices after Tuesday's military coup and potential stock weakness on Thursday when the bourse opens as buying opportunities.
I increased, said Rajeev De Mello, Pictet Asset Management's head of Asian fixed income, when asked what he did with the Thai debt in his portfolio.
Why the calm?
Many big players have become more cautious about how they invest in emerging markets as a result of the 1996–97 meltdown. They try to be far more choosey about which markets they invest in and which they avoid.
Investors are much more wary about lending money to countries with large ... imbalances, said Michael Simms, a former fund manager who is now director of political risk at advisers Exclusive Analysis.
In a similar vein, what was seen as diversified risk a decade ago holding assets in different emerging markets is now more complex.
If you think you are diversified because you have the Philippines and Indonesia, you are not because they both move in the same direction when there is a significantly bad risk event, Pictet's De Mello said.
When you are diversified you will have some credit, some exposure to a country like Korea and you will have some exposure to Indonesia.
As an oil and gas producer, for example, Indonesia suffers when energy prices fall while an importer like Korea benefits.
The main lesson learnt since emerging markets turned on their heads in 1997–98 may, in fact, not have been among the global investors who had poured money into places like Thailand and Korea only to see it vaporise.
Emerging markets themselves from eastern Europeans joining the European Union to Asian tigers becoming powerhouse producers have been restoring and reforming their economies.
All the emerging economies are far less reliant now than they were on overseas capital, said Tony Dolphin, director of economics and strategy at Henderson Global Investors.
Many of these countries have very large reserves. They are lending money to the rest of the world.
Julian Mayo, investment director at Charlemagne Capital, notes that Thailand's foreign exchange reserves have risen sharply to around $59 billion (31 billion pounds). Foreign debt, meanwhile, has been cut and the economy is in surplus.
Countries respond, he said.
The fruits of this improvement can be seen both in the popularity of emerging markets as an asset class and in foreign direct investment, which requires a high degree of commitment.
MSCI's main emerging market stock index has risen more than 170 percent since just before the start of the Iraq war in 2003. Its global counterpart has gained less than half that, just under 85 percent.
Meanwhile, the leading emerging market countries of Brazil, Russia, India and China together attracted more in global FDI last year than the United States.
SPREADING THE RISK
Such improvements in economic fundamentals afford protection to investors by themselves. None of this, of course, means that there is no risk about when it comes to emerging markets.
Recent events such as the Thai coup, violent anti government protests in Hungary, election controversy in Mexico and the assassination of a Russian central banker at the very least build uncertainty.
There is little investors can do if an unexpected event takes place and everyone tries to sell at once. Derivatives may help in some places, but generally if there are no buyers there are losses.
Some analysts, meanwhile, have expressed fears that the rise in the popularity of hedge funds, which move quickly in and out of various markets, could make sudden bolts for door more likely.
U.S. hedge fund Amaranth Advisors did nothing to ease such concerns on Monday when it said year to date losses may top 35 percent because of a wrong way bet on natural gas prices.
Investors also got a taste of contagion earlier this year when concerns that U.S. interest rate hikes would lead to liquidity withdrawal spread rapidly across financial markets.
Emerging markets took the brunt of the pain.