Last week, the United States stepped up its efforts to quell the belligerent and violent Islamic State of Iraq and Syria (ISIS), which has been wreaking havoc and terror for the past several months in Iraq and Syria. President Obama addressed the threat in a televised address claiming the U.S. will do what it takes to track them down and dismantle the group.

Since it came into prominence, the extremist ISIS has posed a serious menace to both the region and to the entire world, threatening to destabilize commerce and industry, and, of course, negatively affect oil prices. But thus far, its impact has been surprisingly muted on most fronts, including on financial markets.

And while portfolio managers agree that the crisis is certainly important and that it has heightened the importance of global geopolitics as a top investment consideration, many aren’t expecting any major market disruptions to occur for the time being. As they wait and watch, here’s how three investors view the ISIS situation vis-à-vis the markets at present:

1.    Ben Rozin, Senior Analyst and Portfolio Manager, Manning & Napier Given the record low levels of volatility in global equities, this year hasn’t given equity fund managers a great run. “We’re active managers and in a slow growth environment, we seek to use volatility to our advantage and to buy the best companies,” said Ben Rozin, senior analyst and portfolio manager at Manning & Napier. Although Manning & Napier, which manages $53 billion in assets (half of which are investing internationally), is “getting our ducks in a row and lining up the best companies we want to own – in the Middle East, in Europe, or anywhere,” in preparation for a period of volatility, that time, Rozin said, hasn’t happened as yet. Logically, the stocks of oil companies and oil sector companies should have experienced a greater downturn as a result of the ISIS insurgency and these are among the stocks that Rozin would be looking to buy should prices come down. However, despite some initial downturn in the price of oil in June, “once it became clear that the majority of Iraq’s oil production is in the south of the country and ISIS has made inroads only in the north,” that reversed course, and now, with increased intervention from the U.S., it isn’t likely that things will go the other way again, Rozin said. Of course, the U.S. dollar has strengthened as it typically does whenever there’s global instability and investors seek a safe haven. However, although it could still happen, stock markets haven’t reflected heightened geopolitical concerns, Rozin said, and that’s also partly due to the fact that the European Central Bank (ECB) and other high level players are doing what’s needed to keep Western economies going, thereby maintaining a status quo and countering any possible negative effects from the Middle East.

2.    William Mann, CIO, Motley Fool Asset Management Motley Fool Asset Management currently owns two stocks that could potentially suffer from what’s going on in Iraq and Syria. But as yet, neither of them has fallen in the slightest. In fact, Philippine company International Container Terminal Services, which has even written off a port it owns and operates in Syria, “is at an all-time high,” said Bill Mann, CIO of Motley Fool Asset Management. Mann would “love to own more” of International Container Terminal Services and Turkish company Coca Cola Icecek, which distributes Coke in Turkey, Pakistan, Jordan and Iraq (the latter is its fastest growing territory, he said). And logically, these names should already have been impacted by the ISIS crisis, but they haven’t, and at current prices, Mann is not inclined to increase his holdings, nor does he believe it necessary to reduce his position. Like other investors, Mann isn’t ruling out the possibility of a downturn and is monitoring the situation. But “The Western governments are so boldly attempting to reward risk behavior and doing what it takes to maintain the system in balance, that their actions are overwhelming whatever impulses investors may have from viewing the world from a geopolitical perspective,” he said.

3.    Kevin Daly, Portfolio Manager, Emerging Markets Debt, Aberdeen Asset Management. When ISIS initially began to make some serious inroads in the northern part of Iraq and there was a sudden fear that the group might possibly claim Baghdad, emerging market investors did react, and bond prices did fall. And even now, said Kevin Daly, emerging market debt portfolio manager at Aberdeen Asset Management, “one could argue that geopolitical risk is having an impact given the yield on the 10-year Treasury, which could be a bit higher if it weren’t for what’s going on in Iraq, Russia and Gaza.” All the same, while investors cannot afford to ignore what’s going on in the Middle East, Daly believes that most are not overly concerned at the moment. “And I think it’s safe to say that the ample liquidity in the global financial system, and actions taken by parties like the European Central Bank, are helping,” he said. At the same time, though, those actions are weighing on yields and pushing them lower, which means many investors are encouraged to look elsewhere, so in a way, the impact of the geopolitical crisis is also positive for the emerging market debt asset class in that it’s driven bond yields down across the board, thereby perhaps creating opportunities for some.