The threat of less central bank stimulus and higher interest rates has crushed emerging markets more than most assets in the past two months, in some cases slashing the value of stocks and bonds in developing countries to levels not seen since the last financial crisis.

The slump after US Federal Reserve Chairman Ben Bernanke signaled in May that the Fed expects to curb and then end its bond-buying program in the next year if the economy improves has pushed prices to levels that would have looked very appealing only a few weeks ago. And some emerging market investors are buying, even with the understanding that there is a big risk markets have further to drop.

"We're starting to selectively increase our exposure to emerging markets," said Andres Calderon, portfolio manager and vice president for research at Hansberger Global Investors in Fort Lauderdale, Florida. "But the key word is selective. We're not rushing in."

There is every reason to be cautious: Many fund managers expect lower growth in emerging markets. Some markets have suffered recently from steep capital outflows, and the slowdown in China has affected other emerging economies, particularly commodity producers. Still, emerging markets are expected to continue to grow faster than developed countries.

Northern Trust Asset Management, for one, has remained overweight in emerging market stocks through the slide. The Chicago-based firm manages $810 billion in assets.

"If you're worried about performance in the next one or two quarters, then it's hard to make a case about a visible catalyst for emerging markets," said Jim McDonald, Northern Trust's chief investment strategist. "But if you have a 12- to 18-month outlook, then this group will work."

He said emerging-market stocks are trading at around 10 times this year's earnings, or a 32 percent discount relative to the Standard & Poor's 500-stock index. The asset class's historic low is about eight times earnings.

Emerging markets have typically traded at a 20 percent discount to the S&P 500 since 2005.

The price-to-book ratio of emerging market stocks on the MSCI stock index is also showing sharp undervaluation at 1.45, not far from the low of 1.36 hit during the depths of the financial crisis, according to Morgan Stanley data. That is still far higher than the 0.93 reached during the Asian crisis of 1997-98. The price-to-book multiple measures the company's value if it goes bankrupt.

"I wouldn't be surprised, though, if EM stocks come down further because there would still be continued outflows from the sector," said Calderon of Hansberger, which is a long-term investor in emerging market equities, with assets of around $6.2 billion.

There is plenty of wreckage to survey for possible bargains.

The benchmark MSCI emerging market stock index is down about 11.3 percent this year, with much of the decline coming in the past six weeks. By contrast, the MSCI's all-country world equity index is still up 4.8 percent this year, while the S&P 500 sports a sizable 12.8 percent gain for 2013.

Global Times