Emerging Market Debt Sustainable Investment Grade Blend
For risk-constrained investors seeking diversified emerging market debt (EMD) exposure with reduced volatility.
- Offers exposure to a wide opportunity set of investment grade emerging market hard and local currency bonds, with a bias towards hard currency denominated debt.
- Combines best ideas using an opportunistic allocation process.
- Seeks to benefit from various risk premiums across the spectrum of emerging market hard and local currency investment grade bonds, and seeks to generate 80% of added value from bottom-up ideas.
Market Risk: The risk of a change in the value of a position as a result of underlying market factors, including among other things, the overall performance of companies and the market perception of the global economy.
Liquidity Risk: The risk that the portfolio may be unable to sell an investment readily at its fair market value.
Emerging Markets Risk: Emerging markets are likely to bear higher risk due to a possible lack of adequate financial, legal, social, political and economic structures, protection and stability as well as uncertain tax positions which may lead to lower liquidity. The value of a portfolio may experience medium to high volatility due to lower liquidity and the availability of reliable information, as well as due to the strategy's investment policies or portfolio management techniques.
Credit Risk: The risk that bond issuers may fail to meet their interest repayments, or repay debt, resulting in temporary or permanent losses to the portfolio.
Interest Rate Risk: The risk of interest rate movements affecting the value of fixed-rate bonds.
Derivatives Risk: The strategy may use certain types of financial derivative instruments (including certain complex instruments). This may increase the portfolio’s leverage significantly which may cause large variations in the value of investments. Investors should note that the strategy may achieve its investment objective by investing principally in Financial Derivative Instruments (FDI). There are certain investment risks that apply in relation to the use of FDI.
Counterparty Risk: The risk that the portfolio may be unable to sell an investment readily at its fair market value.
Operational Risk: The risk of direct or indirect loss resulting from inadequate or failed processes, people and systems including those relating to the safekeeping of assets or from external events.
Currency Risk: Investments in a currency other than the base currency of the portfolio are exposed to currency risk. Fluctuations in exchange rates may affect the return on investment. If the currency of the portfolio is different from your local currency, then you should be aware that due to exchange rate fluctuations the performance may increase or decrease if converted into your local currency.
Market mispricing allows managers to seek alpha opportunities through fundamental research.
- Emerging markets debt is a generally improving asset class that is less efficient than developed debt markets
- Active management is the best way for investors to access the full potential of the asset class
- Bottom-up and top down expertise increases understanding of performance drivers and improves decision making quality
- An emphasis on fundamental research is the best way to uncover the potential of emerging markets debt
Top-down and bottom-up approach with multiple alpha sources allocated opportunistically
Incorporates analysis of global economic drivers, individual country fundamentals, technical factors including supply and demand, and market pricing.
Includes country credit worthiness, analysis of individual credits, ESG considerations, assessment of currency drivers and analysis of local interest rate conditions.
Team combines top-down and bottom-up inputs with risk management to create a model portfolio.
- Ongoing process and performance evaluation.
- Portfolios are adjusted for client-specific guidelines.
Proven Multi-Site Approach
Our presence across three emerging markets time zones allows us 24 hour-a-day market coverage, access to local in-depth knowledge and research and timely execution of investment decisions.
Senior Portfolio Manager