Koesterich Highs EM Bond Opportunities (EMB, LEMB, PCY)

By
May 01, 2012
Share:

 

Emerging markets bonds should be included in investors’ fixed-income portfolios, in part because of how the sector demonstrated resilience during the financial crisis, according to an article on Benzinga that cited a note by iShares Global Chief Investment Strategist for Russ Koesterich.

Koesterich argued in his note that, on average, debt-to-GDP ratios in emerging markets is less than 40 percent. In comparison, the developed world debt has surpassed 100 percent of GDP. For example, Turkey’s ratio is 40 percent, while in the U.S., the ratio is slightly over 100, the article said.

Also, with the exception of India, Inflationary pressures are fading, the article said. Koesterich expects increased stability and improving fundamentals in emerging markets to provide the sector with yearlong momentum, the Benzinga article said.

Koesterich highlighted the iShares J.P. Morgan USD Emerging Market Bond Fund (NYSEArca: EMB).

Other funds to consider are the PowerShares Emerging Markets Sovereign Debt ETF (NYSEArca: PCY) and the Emerging Markets Local Currency Bond ETF (NYSEArca: EMLC), according to the article.

To read the full story, visit Benzinga.com.

ETF.COM CHANNELS

Want to learn more about smart-beta ETFs? Check out our smart-beta guide, essentials library and ETF screener!

ETF DAILY DATA

REIT fund 'VNQ' topped net creations Thursday, July 30, with inflows of $313 million. The least popular ETF of the day was small-cap 'IWM', which lost about 1.6% of its total assets.

'SPY' and 'DIA' paced State Street's issuer-leading inflows Thursday, July 30. Total U.S.-listed ETF assets ended the day at $2.141 trillion.

ETF.COM ANALYST BLOGS

By Matt Hougan

The median ETF tracks its index perfectly excluding expenses. But different firms and funds perform quite differently.

By Paul Britt

Toss and turn about whether to hedge currency risk, but don’t lose sleep over the derivatives themselves.

By Dave Nadig

With the China A-share market half-broken, ETF investors should be very, very cautious.

By Drew Voros

Price depreciation and continued outflows have made for a tough few years.

ETF INDUSTRY PERSPECTIVE

By Invesco PowerShares

A more in-depth look at the smart-beta survey's results.

By Invesco PowerShares

Smart beta appears to be poised for further growth.