By Pablo Cisilino, Stone Harbor Investment Partners
After two years of low returns and high volatility, investors are questioning the thesis that supports investing in local currency debt from emerging markets. Notwithstanding the current cyclical factors that, in the short term, seem to support the US dollar, we believe the main structural features that make most emerging markets and currencies an attractive investment destination are still in place.
Some of the most important factors include cleaner sovereign balance sheets and demographic profiles that favour younger workforces and growing populations. In our view, the re-pricing of the asset class over the last couple of years has created considerable value. Read more