Flash Note

Kapitel 2: Wertschöpfung innerhalb Emerging Markets Anleihen Juli 2016

11.07.2016

With the dollar no longer strengthening, the Fed not aggressively moving in on rates, and Chinese demand stabilising, EM debt appears to offer interesting opportunities. However, selectivity is key in an environment that continues to be volatile. Evaluating each country’s risk and opportunity set is fundamental to single out the best stories in this heterogeneous universe. We believe that commodity exporting countries offer an attractive risk premium with the recent depreciation of their currencies and relative yields compression in contrast with manufacturing countries in emerging markets.

Carmignac Portfolio Unconstrained Global Bond

Opportunistic and conviction driven approach to seize attractive risk premiums in emerging countries

Brazil, exhibits potential

  • Appealing nominal and real rates
  • Improving exports and current account balance, thanks to a weaker Brazilian Real
  • Downward pressure on inflation
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Mexico, an inflation-linked story

  • Attractive real rates
  • Government firm on reform execution
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Argentina, renewed hope

  • A newly formed government with a focus on improving economic fundamentals and investment climate
  • Encouraging roadmap to deliver much-needed reforms
  • Attractive carry on short maturity sovereign bonds
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Poland, access to attractive real rates

  • One of the highest real rates in the emerging universe
  • Negative inflation territory, and below euro zone average
  • Improving current account balance
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