Choosing the "Plus" in Core-Plus: The Cases for High-Yield Bonds, Emerging Market Debt, and Sovereign Debt

2001 ◽  
Vol 2001 (1) ◽  
pp. 60-79
Author(s):  
Barry Coffman ◽  
Ismail Dalla ◽  
Kenneth Windheim
Keyword(s):  
Sovereign Debt ◽  
Emerging Market ◽  
High Yield

Sovereign debt in emerging market countries: not all of them are serial defaulters

2018 ◽  
Vol 50 (59) ◽  
pp. 6406-6443 ◽  
Author(s):  
Gilles Dufrénot ◽  
Anne-Charlotte Paret
Keyword(s):  
Sovereign Debt ◽  
Emerging Market ◽  
Emerging Market Countries

Tracking Global Demand for Emerging Market Sovereign Debt

2014 ◽  
Vol 14 (39) ◽  
pp. 1 ◽  
Author(s):  
Serkan Arslanalp ◽  
Takahiro Tsuda ◽  
◽  
Keyword(s):  
Sovereign Debt ◽  
Emerging Market ◽  
Global Demand

US rates may rise but economic risks are rising faster

2017 ◽  
Keyword(s):  
Interest Rates ◽  
Euro Area ◽  
Sovereign Debt ◽  
Emerging Market ◽  
Content Type ◽  
Political Risks ◽  
Bond Yield ◽  
Treasury Bond ◽  
The Face ◽  
Equity Index

Subject Global equity market trends. Significance The four main US stock market indices began March at record highs, including the benchmark S&P 500 index at 2,400. Driven by expectations of stimulative and pro-business policies under the new US administration, equity markets are flying in the face of signals from the Federal Reserve (Fed) that interest rates will rise three times this year. The probability of a hike at the Fed’s March 14-15 meeting has risen above 80% on growing price pressures and stronger economic data, buoyed by hawkish comments from several Fed governors, including those who were previously dovish. Impacts Despite the post-election US bond market sell-off, around one-third of the stock of euro-area sovereign debt remains negative yielding. The gap between the two-year US Treasury bond yield and its German equivalent has widened to a record, a sign of rising monetary divergence. The euro lost 2% against the dollar in February as political risks escalated in the euro-area, centred around the French election. The emerging market MSCI equity index is 8.6% up this year, after losing 4.5% from November 9 to end-2016, a sign of higher confidence.

Central Europe's lower yields may dampen bond outflows

2018 ◽  
Keyword(s):  
Czech Republic ◽  
Emerging Market ◽  
Oil Prices ◽  
High Yield ◽  
Corporate Debt ◽  
Bond Markets ◽  
Quantitative Easing ◽  
The Czech Republic ◽  
Content Type ◽  
Financial Conditions

Subject QE’s influence on Central Europe’s bond markets. Significance Hawkish signals from the ECB are adding to recent strains on global bond markets, causing German ten-year Bund yields to shoot up to their highest levels since July. The sell-off is contributing to sharp outflows from Central Europe’s local debt markets, already under pressure as monetary tightening starts in the region; the Czech Republic, which has raised rates twice since August, is suffering the largest withdrawals. However, the absence of large inflows since the ECB started quantitative easing (QE) in 2015 could help mitigate the fallout from its end. Impacts As OPEC members reaffirm their commitment to production cuts, oil prices are shooting up to their highest level in nearly three years. Sales of speculative-grade US corporate debt have had their strongest New Year since 2014, a sign of enduring demand for high-yield bonds. The three-year low in the dollar index will help keep financial conditions loose and buoy up emerging market currencies.

scholarly journals Natural Catastrophes and Sovereign Bond Prices

10.28945/3784 ◽  
2017 ◽  
Author(s):  
Burkhard N Schrage
Keyword(s):  
Developing Countries ◽  
Natural Disasters ◽  
Sovereign Debt ◽  
Emerging Market ◽  
Investment Decisions ◽  
Future Research ◽  
Bond Prices ◽  
Sovereign Bond ◽  
Natural Catastrophes ◽  
Parametric Analyses

Aim/Purpose: This study investigates effects of natural catastrophes on the cost of sovereign debt in developing countries and discusses MNC financing strategies. Background: Over the last decades, natural disasters have increased in both number and severity. The combination of higher event frequency and intensity, coupled with fragile economic conditions in emerging market countries, may affect sovereign bond prices—particularly in developing countries—and consequently may have effects on the financing strategy of MNCs Methodology: Parametric and non-parametric analyses and event study method. Contribution: The current literature in International Business research has overlooked natural catastrophes as a source of heterogeneity across countries for investment decisions. We develop the theory and demonstrate empirically that both researchers and practitioners should take into account natural disasters when making internationalization decisions. Findings: We find that natural disasters have a material impact on the bond returns issued by developing country governments and consequently on MNCs’ host-country financing costs. Recommendations for Practitioners: Practitioners may consider the likelihood of natural disasters when making investment decisions in foreign countries. Recommendation for Researchers: Researchers may consider including natural disasters when in internationalization research; our research adds in particular a new dimension to the location choice literature. Impact on Society: Governments—in particular those in emerging markets—may rethink their strategies of how to “insure” themselves against natural disasters. Not being insured against these disasters result in negative secondary effects on economic development through higher cost of capital, and possible through lower FDI activities. Future Research: Future research can be done. There are several avenues: using our insights and applying them to governmental reinsurance strategies would be a worthwhile topic. On a different level, one could also investigate further the contingencies of our findings and extend the theoretical framework towards developed markets.

Fiscal policy may deter holding Romanian debt

2017 ◽  
Keyword(s):  
Interest Rates ◽  
Sovereign Debt ◽  
Emerging Market ◽  
Central Banks ◽  
Bond Markets ◽  
Social Democrat ◽  
Content Type ◽  
East European ◽  
Central Eastern Europe ◽  
National Bank

Subject The outlook for Central-East European debt. Significance A flurry of hawkish commentary from the world’s leading central banks, in particular the ECB, which is preparing the ground for a withdrawal of monetary stimulus, has put significant strain on the domestic bond markets of Central-Eastern Europe (CEE). Under particular pressure are Romanian domestic bonds, because of the threat of fiscal slippages under the new Social Democrat (PSD)-led government, which are likely to force the National Bank of Romania (NBR) to hike interest rates more aggressively than its regional peers. Impacts Despite the central-bank-driven sell-off in global markets, negative-yielding bonds still account for one-fifth of global sovereign debt. Persistent concerns about a supply glut are keeping Brent crude below 50 dollars per barrel, with oil prices down by 14% since end-May. Emerging Market stocks are declining under pressure of hawkish rhetoric from central banks, but not Hungarian and Czech equities.

Global Opportunities in High-Yield and Emerging Market Debt

2005 ◽  
Vol 2005 (1) ◽  
pp. 23-31
Author(s):  
B. Daniel Evans ◽  
Mark J. Siegel
Keyword(s):  
Emerging Market ◽  
High Yield
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