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Deliberating EM debt
Our EM debt team tackles the topics that are top of investors’ minds and provides insights for asset allocators currently deliberating EM debt.
Strategy overview
Strategy overview
Investment Approach
Bottom-up investment decision-making aims to harness the significant inefficiencies in this investment universe, ensuring the portfolio aligns with top down risk allocation targets.
Investment Opportunity
Aims to unlock relative value opportunities in Chinese fixed income and provide access to the asset class’s relatively high risk premia and yields.
Investment Universe
Invests across the full universe of onshore CNY and offshore USD bonds, spanning the spectrum of rates, corporate credit and FX.
Target Return
Outperform the performance comparison index (net of fees) over a full market cycle
The role the strategy can play in portfolios
Improved risk-return potential
Differing and mainly domestic market drivers mean low correlations with major asset classes and significant diversification benefits
Quality yield with lower volatility
Among major global bond markets, onshore CNY bonds typically have the highest yield and historically lower FX and bond price volatility
Lower duration investment grade
Offshore USD bonds offer spread pick-up with lower duration risk. Onshore CNY bonds are a potential safe haven in stressed markets
Exposure to a growing alpha opportunity
Seeks out relative-value opportunities across a segmented asset class that is increasing in breadth, depth and accessibility
Investment Philosophy
Key facts
Asset Subclass
Sovereign & CreditCurrency
USDInception date
01/06/2011
Team
Emerging market fixed income teamGeographical Focus
Emerging MarketsESG Classification
ESG IntegrationComparative Benchmark
Bloomberg Global Aggregate - Chinese Renminbi Index (pre 30/08/2019 iBoxx ALBI Offshore China, pre 01/05/2016 HSBC OS RMB Overall, pre 01/01/2015 CNHDR)
Portfolio & Holdings
Date as of 31/10/2024
Credit breakdown (%)
Currency positions (%)
Geographic breakdown (%)
Maturity profile (%)
Sector breakdown
Top holdings (%)
Portfolio Statistics
Index
Strategy
AA
A
100
BBB
BB
B
C
Cash and near cash
*Bond ratings are Ninety One approximations.
Based on a related portfolio within the strategy with substantially similar objectives as those of the services being offered. The portfolio may change significantly over a short space of time. This is not a buy, sell or hold recommendation for any particular security. For further information on Indices and Specific Portfolio Names, please reference the sections in https://ninetyone.com/-/media/documents/miscellaneous/91-further-information-en.pdf.
Why Ninety One for All China Bond Strategy
Contact our client service teams.
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.
Emerging 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.
Geographic / Sector
Investments may be primarily concentrated in specific countries, geographical regions and/or industry sectors. This may mean that, in certain market conditions, the value of the portfolio may decrease whilst more broadly-invested portfolios might grow.
Interest Rate
The value of fixed income investments (e.g. bonds) tends to decrease when interest rates rise.