Are Stronger Fundamentals Changing the Case for Emerging Market Debt?

Emerging market debt has long carried a reputation for sharp swings, political uncertainty and sovereign defaults. Yet over the past year and a half, the asset class has outperformed U.S. Treasuries, high-yield corporate bonds and the broader U.S. bond market, even as geopolitical risks have increased.  In a recent episode of The Wealth Enterprise Briefing, Managing Partner Michael Zeuner and Senior Investment Manager Sam Sudame examine what may be behind that performance and what it could mean for fixed-income investors.  They talk through:  Stronger fiscal and monetary policies across emerging markets.  Lower debt-to-GDP ratios than in many developed countries.  The role of inflation targeting, central bank independence and foreign exchange reserves.  Yields about 200 basis points above developed-market government bonds The political and economic risks that remain.  Why active management is vital in this market.  Where emerging debt may fit within a diversified income portfolio.  Emerging market debt is not appropriate for every investor, but recent changes in policy credibility and fiscal discipline warrant a closer look. If you would like to discuss the role of global fixed income in your portfolio, we welcome a conversation.  Important Information: The Wealth Enterprise Briefing contains our current opinions and commentary, which are subject to change without notice. The Briefing is distributed for informational and educational purposes only and does not consider the specific investment objective, financial situation or particular needs of any recipient. Information contained herein has been obtained from sources we believe to be reliable, but we do not guarantee its completeness or accuracy. The information in the Briefing is not a recommendation of any security, and should not be relied upon as investment, legal or tax advice. Please consult with your investment, legal and tax advisors regarding any implications of the information presented in this presentation.