Presidential elections may make investors look more kindly on Egypt, as a further sign of democracy in the country.

Egypt, the best-performing MSCI emerging equity market this year, has risen 40 percent after falling sharply in 2011, but  many investors remain cautious.

Ghadir Leil Cooper, who runs a Middle East and North Africa equities fund at Baring Asset Management, has been underweight Egypt for over a year, following the ousting of Hosni Mubarak as president. But it could soon be time for a rethink, she says:

I would look to see which direction the elections take. It’s only three weeks, we will have a president in June.

Egypt’s current discussions with the IMF over a $3.2 billion loan are a positive, Leil Cooper says, after the country last year rebuffed the international lender.