Emerging Markets Sustainable Blended Debt Strategy

Total return strategy with a focus on markets with positive sustainability dynamics.

Strategy overview

Seeks to deliver compelling risk-adjusted returns by selectively investing across the broad emerging market debt investment universe and emphasising sustainability.

Key features
  • Aims to generate improved risk-adjusted returns via a total-return, benchmark-agnostic approach
  • Invests across the broad EM opportunity set, including hard currency bonds, FX and local rates
  • Investments focus on countries with improving trends around governance, social progress and sound management of natural capital
  • Selectively includes investments in green and sustainable bonds
We believe fixed income assets of countries with improving sustainability trends provide the potential for outperformance.
Peter Eerdmans
Grant Webster
Nicolas Jaquier

Investment approach

01

Actively invests across the entire emerging market debt investment universe, favouring markets with positive ESG dynamics and avoiding lowest scorers.

02

Process is underpinned by proprietary Sustainability framework, which takes a forward-looking approach and places a heavy emphasis on engagement with issuers.

03

Bottom-up approach selects individual best ideas1 to achieve the desired top-down asset allocation.

1 Best Ideas’ represents our highest conviction ideas following fundamental analysis.

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General risks. Past performance is not a reliable indicator of future results and performance targets may not be achieved; losses may be made.

Specific risks. Currency exchange: Changes in the relative values of different currencies may adversely affect the value of investments and any related income. Default: There is a risk that the issuers of fixed income investments (e.g. bonds) may not be able to meet interest payments nor repay the money they have borrowed. The worse the credit quality of the issuer, the greater the risk of default and therefore investment loss. Derivatives: The use of derivatives may increase overall risk by magnifying the effect of both gains and losses leading to large changes in value and potentially large financial loss. A counterparty to a derivative transaction may fail to meet its obligations which may also lead to a financial loss. Interest rate: The value of fixed income investments (e.g. bonds) tends to decrease when interest rates rise. Sustainable Strategies: Sustainable, impact or other sustainability-focused portfolios consider specific factors related to their strategies in assessing and selecting investments. As a result, they will exclude certain industries and companies that do not meet their criteria. This may result in their portfolios being substantially different from broader benchmarks or investment universes, which could in turn result in relative investment performance deviating significantly from the performance of the broader market. Emerging and Frontier market (inc. China): These markets carry a higher risk of financial loss than more developed markets as they may have less developed legal, political, economic or other systems.

Important information
This communication is provided for general information only should not be construed as advice.

All the information in is believed to be reliable but may be inaccurate or incomplete. The views are those of the contributor at the time of publication and do not necessary reflect those of Ninety One.

Any opinions stated are honestly held but are not guaranteed and should not be relied upon.

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