Real yields are nominal yields adjusted for inflation, which is often one of the greatest contributors to the nominal yield levels of emerging markets local currency bonds.
As the emerging market local debt assets (EBND) (ELD) continue to evolve and expand, investors are increasingly looking for opportunities in the space to enhance returns.
With the addition of three new countries to the JPMorgan GBI-EM Global Diversified Index earlier this year, the EM local debt (FEMB) market continued its growth in 2017.
During the past two decades, EM (emerging markets) local debt has evolved to become the largest and most liquid debt market within the emerging market bond space.
Many leading bond index providers are still not including China’s onshore bonds in their benchmark indexes due to various regulatory and operational concerns.
VanEck Given these uncertainties, high yield bond investors may want to ratchet up the credit quality of their portfolios. Fallen angels can be a source of higher quality high yield for investors, given about 77% of the universe was concentrated in BB-rated bonds (just one ratings notch below investment grade) as of April 30, 2017.[2.Composite […]
Emerging market debt can be a great source of income potential in a diversified portfolio, provided you can manage it during a period of extreme volatility.
The VanEck Vectors EM Local Currency Bond ETF (EMLC) could be a good entry point after it took a hit following rising interest rates and volatility in the US dollar.
Negative bond yields in Japan and low Fed funds rates in the United States and the Eurozone were one reason emerging market bonds performed well in 2016.
Trump’s unexpected presidential victory caused short-term uncertainty about markets and policies. His win reinforced a reflationary theme in global markets.
Although Hungary and Turkey credit spreads were at similar levels and generally moved together through 2014, these spreads began to diverge in early 2015.
The Turkish lira plunged to record lows against the dollar following its downgrade by Moody’s and S&P, who cited increased political instability as well as geopolitical stresses and turbulence.
In recent years, emerging market (EMLC) (HYEM) ratings have improved considerably due to the strengthening macroeconomic framework as well as years of reforms.
Investors with higher risk appetites may want to shift their focuses to emerging market bonds, as most developed market bonds are trading at negative yields.
Growth in emerging market (EMLC) (HYEM) and developing economies is projected to increase from 4% in 2015—the lowest since the 2008–09 financial crisis—to 4.3% and 4.7%…
Strong Local Currency Performance As Rates Remain Steady Returns in the emerging markets debt space have so far in 2016 ranked commensurately with risk. More specifically, local debt has been the top performer, with a total return of 17.08% YTD after a very strong September (2.02%). Although local sovereigns are lower duration by nearly two […]
Negative bond yields in Japan and the Eurozone, coupled with very low federal funds rates in the United States, are part of why emerging market bonds and currencies have performed so well in 2016.
The International Monetary Fund defines REER as an average of the bilateral real exchange rates between a country and its trading partners, weighted by their respective trade shares.
Investment-grade emerging market sovereigns have been given BBB or higher credit ratings by one of the credit rating companies. They’re relatively safe.
Brazil’s (BRF) new government is eager to implement structural reforms to strengthen fiscal responsibility, and the central bank is likely to follow suit.
In the wake of disappointing economic indicators over the past month, the Federal Reserve kept the interest rate unchanged in its policy meeting this week.
Perhaps one of the biggest tailwinds recently, particularly for local currency strategies, has been the stabilization and rebound in commodity prices this year.
In addition to supportive technical and monetary policy, fundamentals appear to be stabilizing, and in many cases, improving in emerging markets economies.
Emerging market debt (EMB) offers plenty of opportunities to investors. Markets are expected to continue their outperformance for the next few quarters.
While global growth statistics remain within muted expectations, EM debt and equity could remain the beneficiaries of additional capital flows for some time.
Emerging market (or EM) international bond funds invest in bonds whose issuers are based in countries whose economies aren’t as advanced as those in developed markets.
