A Guide to Emerging Market Debt

Emerging countries offers investors big risks and big rewards when it comes to their government and corporate debt markets

Maarten van der Pas 4 March, 2013 | 10:00AM

Investors may want to consider government and corporate bonds from emerging markets (aka emerging market debt) as they hunt for returns. Investing in emerging market debt is similar to travelling: you can now fly relatively easily and cheaply to every corner of the world, but that does not mean you should do it. A common-sense traveller would avoid unsafe areas and a bond investor should also keep this in mind.

A private investor interested in emerging market debt would likely want to appoint a fund manager to help him access these markets

Outside investors do not always have easy access to local credit markets in emerging countries, there are sometimes capital restrictions for foreign investors, there may be withholding tax levied and there can be other legal and regulatory obstacles.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Cemex SAB de CV ADR2.82 USD2.55
Petroleo Brasileiro SA Petrobras ADR8.48 USD0.36

About Author

Maarten van der Pas

Maarten van der Pas  is the financial markets editor at Morningstar Benelux.

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