The sell-off in BRIC nations is not a reflection of underlying problems in those economies, but a reflection of a huge risk aversion, because of problems in the developed world, says Phillip Poole, global head of macro and investment strategy at HSBC AMC.

"These markets, however, look cheap at current levels in comparison to their own trading history," Poole told ET. "If you are looking for mid- to long-term value, all of the BRIC markets are trading significantly cheaper to their five-year averages. In India's case, it's 11.3 times its 2012 earnings relative to an average of around 15 times while Russia is trading 4.5 times its earnings relative to an average of 8 times," he said.

Poole maintains that in the near-term, markets could fall by another 10%. "The problem is everyone is caught up in the short-term noise and the investment horizon for even long-term investors has shrunk," says the strategist.

Volatility has also had an impact on investors - ranging from retail investors to pension funds to central banks and sovereign wealth funds.

The HSBC strategist says that investors should look for anchors or themes to construct portfolios in the current environment.

"Two themes that make sense from an emerging market point of view is the emerging market consumption story and emerging infra story," says Poole who believes that India is a vibrant consumption story. However, the India infrastructure space, though attractive, has its own share of problems.

"Cyclicals, like the auto sector, look attractive as well as some of the financial sector," he told ET. What he does not like are defensives such as telecom companies. The strategist, however, suggests investors pick a theme that will play out over the longer-term but not be limited to emerging markets alone.

"Many MNCs don't have the issues that you have in China, India or Russia. There are elements of the developed world that is positive. This gives people great conviction during times of sell-off," he says.

Poole, who is less concerned about India's fiscal deficit, compared to other countries (like the US), believes the real challenge for India is to realise its demographic dividend. "However, this is going to take education and infra spend," he said. While he forecasts Asia currencies are in for a choppy ride ahead, he is of the view that it would be a mistake for the Reserve Bank of India to cut rates too early. "Maybe, there is another rate hike by year-end. But beyond that, rates should be kept at a high level for several months to try and squeeze down those expectations."

As regards decoupling, Poole maintains there is an element of decoupling by emerging markets in economic terms, not on financial terms. "The good news for India and Brazil is they are relatively closed economies," he said.

Poole anticipates a slowdown in emerging markets, particularly in economies like China, India and Brazil, which have been growing too rapidly. "It is a good thing as it helps deal with the inflation problem," he said.

On global markets, Poole says that the Euro zone problem, which is a decade old, will linger on. "It is a huge overhang for growth," he said, adding that in order for markets to stabilise and potentially recover, one needs to see expectations come down to a more realistic level.

"One of the most positive things is that central banks have acted in a concerted way. But to stop the rot we need a meaningful and sustainable solution and come to grips with where it all started."