EM investors go down credit curve to hedge

摘要

Worried about a rise in US Treasury yields, some emerging market investors are shunning high-quality corporate bonds and reaching down the credit spectrum to reduce rates sensitivity in their portfolios. The strategy could boost total returns at a time when credit spreads have little room to compress further and competition to outperform benchmark indices runs high among fund managers. "Investing in emerging markets has become a macro exercise, where individual credit stories are less important than US Treasury moves and global liquidity conditions," said Jim Barrineau, co-head of emerging market debt relative at Schroders.