Investors have felt the benefit of quantitative easing - the Fed's money printing policy has helped put pounds in their pockets. But it can't go on forever, and so, when the US economy looked to be on a surer footing, Ben Bernanke the then-chairman of the Federal Reserve announced plans last May.
Since then we have had a change in chairman, a US political shutdown - and no tapering. Even so, markets have been jittery. In particular, certain emerging markets which have come to rely on the QE cash.
Cash has flooded emerging markets since QE1 was first initiated in 2008, turning cheap borrowing into high returns which was then invested in risky emerging market equities and bonds. This tide of cash will subside once the Fed cuts back on its stimulus however, and as a result Asian stock markets fell in the months after the May announcement.
QE tapering is now widely expected to happen in the first six months of 2014, and savvy investors are using the post-announcement jitters as a heads-up as to which stock markets are most sensitive to US money market movements.
Emily Whiting, of JP Morgan's Emerging Markets Equities team said that there were five markets in particular that have grown in an environment of cheap and easy money - and are therefore most at risk. The currencies of Turkey, Brazil, India, Indonesia and South Africa all suffered the most at tapering rumours.
These 'Fragile Five', which are spread across all three regions in emerging markets, have all seen their currencies impacted strongly.
"This shouldn't surprise us - the US recovery brings with it a strong US dollar and rate normalisation - this headwind was always going to happen it was just a question of when, not if," she said. "Markets had anticipated these effects and those hurt most were those with wide or widening current-account deficits."
However - this is not a call to action. Even the most vulnerable of the ‘Fragile 5’ has much higher reserves than during the emerging markets currency crisis in the Nineties. These markets are more mature - and have learnt from past mistakes. JP Morgan predicts that there will not be a repeat of the crisis that happened in the Nineties as a result of tapering - but investors should steel themselves for volatility.
Whiting presses that this volatility could in fact be an opportunity for investors to pick up emerging market equities on the cheap.
"Understandably with all of the short-term pressures and cyclical effects markets are looking very cheap. Valuation is an incredibly important metric," she said.
"This positions the asset class at a very attractive valuation. If you buy in at pessimistic stage, when people have uncertainty, you typically get strong returns over the following 12 months. As Warren Buffett said 'be greedy when everyone else is fearful'."
Juliet Schooling-Latter of Chelsea Financial Services said that she was concerned as to how long this protracted volatility may last.
"Emerging markets are indeed very cheap but they could of course get cheaper," she said.
"My worry is that we are in an unprecedented environment and no-one knows how long it take to unwind - US tapering could begin in Dec or spring next year, and that will just will be just the beginning. There is likely to be continued volatility and we don't know how soon these markets will get used to the idea."
Schooling-Latter said that any investor considering investing in these markets should only do so one a very long term view, and opt for monthly contributions rather than a lump sum to smooth returns.
