Bonds.com, Inc. through our trading platform, BondStation.com,
is pleased to offer access to non-callable, U.S. dollar denominated secondary offerings for Emerging Market debt issues.
Product Overview:
Emerging Market Debt (EMD) is primarily issued by sovereign issuers. Sovereign issuance has historically
been primarily issued in foreign currencies (external debt), either US Dollars or Euros
(hard currency versus local currency). Most developed countries are AAA or AA-rated, yet EMD issues
are typically rated below investment grade. EMD tends to have a lower credit rating than other sovereign
debt because of the increased economic and political risks. However, certain countries have been upgraded
to BBB or A ratings, and some lower income countries have ratings levels comparable to more developed
countries.
Features and Benefits:
- Credit Quality – Rising credit quality and inflows from new investors into Emerging Markets increases the likelihood of a decline in yields (increasing potential for capital gains). Increases in the value of local currencies relative to the U.S. dollar and other global currencies, may also potentially lead to capital gains
- Yields – EMD offer attractive yields on a risk-adjusted basis
- Diversity – Emerging Markets offer diversity as an asset class, both regionally and the instruments available in the market. This diversification has the potential to reduce the volatility of a fixed income portfolio, as returns are not highly correlated with those of traditional asset classes
Risks:
- Emerging Market debt is subject to: currency and political risks. Additionally, differences in custody arrangements made for foreign securities, and accounting procedures should be considered
Taxes: For full information regarding the tax consequences of Emerging Market securities, investors should consult their tax advisor.
For more information please call one of our Relationship Managers at 1-888-266-3708.
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