The J.P. Morgan EMBI (Emerging Market Bond Index), EMBI+ (Emerging Market Bonds Index Plus) and EMBIG (Emerging Market Bond Index Global) indexes are designed to help individual and institutional investors benchmark bond performance in emerging markets around the world, with each index covering different types of emerging market economies. J.P. Morgan Emerging Markets Bond Index Plus is a market capitalization-weighted index based on bonds in emerging markets. the EMBI series which covers all of the external currency denomination debt of the emerging markets, as opposed to simply Brady Bond investment. It is constructed with well-defined liquidity criteria to ensure that the index provides a fair and replicable benchmark. There are currently .
After a buoyant , investor expectations for EM debt were high at the beginning of the year. However, injected a much-needed dose of realism. Now, on the cusp of , we believe prices are more attractive than they have been for a while. All investments involve risks, including possible loss of principal. Special risks are associated with investing in foreign securities, including risks associated with political and economic developments, trading practices, availability of information, limited markets and currency exchange rate fluctuations and policies.
Sovereign debt securities are subject to various risks in addition to those relating to debt securities and foreign securities generally, including, but not limited to, the risk that a governmental entity may be unwilling or unable to pay interest and repay principal on its sovereign debt. Because these frameworks are typically even less developed in frontier markets, as well as various factors including the increased potential for extreme price volatility, illiquidity, trade barriers and exchange controls, the risks associated with emerging markets are magnified in frontier markets.
Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in an investment portfolio adjust to a rise in interest rates, the value of the portfolio may decline. This material is intended to be of general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any security or to adopt any investment strategy.
It does not constitute legal or tax advice. The views expressed are those of the investment manager and the comments, opinions and analyses are rendered as of the publication date and may change without notice. The information provided in this material is not intended as a complete analysis of every material fact regarding any country, region or market. FTI accepts no liability whatsoever for any loss arising from use of this information and reliance upon the comments, opinions and analyses in the material is at the sole discretion of the user.
Please consult your own professional adviser for further information on availability of products and services in your jurisdiction. Indexes are unmanaged, and one cannot invest directly in an index. They do not reflect any fees, expenses or sales charges. Past performance does not guarantee future results. Morgan has 16, employees in the UK today. Nothing changes for J.
We will maintain a large presence across the United Kingdom and continue to serve clients in the EMEA region, as we have for more than years. Once they have been further clarified in the coming months, we will communicate with our clients promptly on relevant changes we may need to make to our European business model. As our research teams have reported, we recognize the potential for market volatility and we are ready to help our clients work through this.
We have been preparing internally and will be available to assist you through this period. If we are required to change our legal and regulatory structure in the coming months or years, we will notify you promptly if there are any changes that impact your relationship with J.
Until then, we will continue to serve our clients as usual. Including GCC sovereign debt could prove to be a major boost to the region, deepening regional debt markets and supporting overall debt issuance. It might also lower funding costs for Gulf-based companies and ultimately lead to higher regional growth. While the USD debt issuance from the Middle East has received widespread attention, the local currency market has been quietly growing as well.
Saudi Arabia now has more than USD 68 billion in local currency sovereign bonds outstanding and is among the last sizeable market not to have been added to major fixed income indices. A number of recent developments have improved access to capital markets. This has increased market transparency and would allow investors to fairly value their bond investments should they wish to invest in domestic local currency bonds. The government also recently announced the appointment of five financial institutions to be the primary dealers in local government securities, which should help improve the liquidity and trading of domestic government bonds.
Clearly, the stakes are high and the region is worth watching. At a time when market sentiment is turning more cautious, expanding the universe of investible debt markets to higher-rated GCC countries should not only benefit the GCC states looking to deepen and diversify their capital markets, but should also open up new opportunities for global investors.
While JP Morgan will not announce their decision until later in the year, this review of GCC hard currency bonds should make investors sit up and take notice of the changing market dynamics in the Middle East. Most investors are aware of the debt issuance supply story from the region, but the demand story may soon be picking up as well.
A comprehensive emerging market debt benchmark that tracks local currency bonds issued by emerging market governments.
We do not think this particular upturn in manufacturing is going to be any different.
Current Daily Dividend Accrual. Sprucegrove Special International Pooled Fund.