Emerging Market Debt: Enhancing a Global Bond Portfolio

Over the last two decades, the emerging market debt (EMD) market has grown significantly. It now accounts for over 27% of the global bond market,* while trading liquidity has improved. We think this makes it too big for global bond investors to ignore. EMD provides an attractive yield pick-up from investment grade bonds, while its lower correlation and higher growth factor exposure compared to global aggregate bonds offers diversification benefits.