|Bid||109.17 x 300|
|Ask||122.07 x 3100|
|Day's Range||115.51 - 115.77|
|52 Week Range||111.31 - 117.46|
|PE Ratio (TTM)||N/A|
|Expense Ratio (net)||0.40%|
Emerging market corporate bonds are offering the least yield to bond-buyers since 2007. Here’s why demand is so hot.
BRICs was the buzzword for emerging market investors in the early part of this century, with strategists extolling the prospects for rapid economic growth in Brazil, Russia, India and China. Many of the Fragile Five, which included India and Indonesia, are in better shape now, while emerging market debt has had a strong run this year. "The five are ‘fab’ because they are high yielders and net commodity exporters, which means their local bonds are expected to benefit from higher commodity prices," De Silva writes.
Investors have poured $65 billion into emerging market debt funds so far this year, marking the strongest run in history for the asset class. In fact, only three weeks of the year have seen outflows, according to Morgan Stanley strategist Simon Waever. The flood of money into the category is not sending up flares for Waever, who sees technical factors supporting further gains for emerging market debt investors. While Waever says investor should prefer local currency debt, which has sold off since September, over dollar-denominated debt next year, it is the latter that has seen the most interest from investors, likely because it is an easier move for U.S. investors who don't want to take on currency risk.
In search of higher yields, many investors have been embracing ETFs holding emerging markets bonds this year, a theme benefiting funds such as the iShares J.P. Morgan USD Emerging Markets Bond ETF (NASDAQ: ...
Emerging Markets It was Russia to the rescue as Venezuela slipped into default on Nov. 13 for not paying two U.S.-dollar debt obligations on time. After the Venezuelan government said it had offered bondholders the chance to renegotiate on Monday—the offer was short on details—credit-rating agencies declared the country in selective default. Two days later, the Russian finance ministry declared that it will allow Venezuela to stretch $3.15 billion in debt repayments over 10 years.
The International Swaps and Derivatives Association ruled Thursday that Venezuela and its state oil company defaulted on some debt, which will trigger payment on credit default swaps. With late or non-payment ...
Venezuelan sovereign bonds have been among the world's most volatile. On Wednesday, the South American country unveiled a debt restructuring deal with Russia and, separately, earned words of encouragement ...
Venezuela's bonds were paying yields in excess of 30% as the odds of default mounted, and investors were plucking what they thought would survive for their portfolios. Prices for short and long durations could converge, however, after S&P Global Ratings and Fitch Ratings late Monday declared the cash-starved Venezuelan government is in selective default, based on past-due payments. The announcements came after the Venezuelan government made a last-ditch effort to renegotiate in meetings with bondholders in Caracas Monday.
S&P Global Ratings downgraded Venezuela's foreign currency sovereign credit rating late Monday beyond junk to "selective default" after it failed to make two payments within a grace period. On Monday, bondholders met in Caracas at the invitation of President Nicolas Maduro to discuss restructuring debt issued by the the government and state-owned oil company Petróleos de Venezuela. Also late Monday, Fitch Ratings downgraded long-term foreign and local currency ratings on state-owned oil company Petroleos de Venezuela (PDVSA) to restricted default, and said bondholders' recovery of their investment may be at the low end of the anticipated 31% to 50% range.
The Venezuelan government wants bondholders to come to Caracas Monday to restructure debt as it scrounges for cash. Venezuela seems to have avoided a default this week after Russia said Wednesday that it would restructure $3 billion in loans to Caracas to free up money for payments that are past due.
Equity markets in the US have notched record after record in 2017, but emerging markets are on pace for a record year of their own.
Venezuela could still avoid default. Money could come out of nowhere, and Monday was a Venezuelan holiday, so it still could make a payment today, technically three business days late as allowed, and push off the inevitable, writes Siobhan Morden, head of Latin America Fixed Income Strategy at Nomura Securities International. There is debate whether the Monday holiday in Venezuela would provide one extra day for the grace period.
If Venezuela does not make a $1.12 billion payment that was due Nov. 2 tonight, Tuesday, default may finally happen. "Coupled with the previously missed payments on outstanding sovereign bonds that are currently within their 30-day grace periods, a default event appears highly probable," Fitch Ratings said in a downgrade of Venezuela's Corporacion Electrica Nacional Tuesday. The International Swaps and Derivatives Association will be asked to rule if credit default swaps (CDS), a form of insurance when debt payments aren't made, have been triggered.
Over the last ten years, the green bonds (GRNB) universe has expanded and diversified, holding 600 bonds from 24 countries in 23 currencies.
Fitch Ratings said Venezuela's debt default is probable late Friday, and it downgraded the country's long-term foreign currency debt rating deeper into distressed territory. UPDATED: S&P Global Ratings took similar actions a few hours later Friday in reducing its rating on Venezuela's long-term, foreign-currency sovereign credit to CC from CCC minus. UPDATED: S&P sees a "one-in-two chance that Venezuela defaults within the next three months." Until now, the government had said it intended to make payments.
There's doublespeak from Venezuela on debt default as the nation scrambles to make a payment. President Nicolas Maduro said Thursday that the state-run oil producer Petroleos de Venezuela or Pdvsa would make a final $1.1 billion bond payment Friday, but he also issued another order regarding the country's roughly $120 billion in foreign debt, according to the Associated Press: "I decree a refinancing and a restructuring of all external debt and all of Venezuela's payments," Maduro said in a nationally broadcast address Thursday. Siobhan Morden, head of Latin America Fixed Income Strategy at Nomura Securities, writes that investors should not rule out an accidental default, though she thinks the government can probably make a past-due Electricidad de Caracas (Elecar) interest payment in a grace period that expires Nov. 9.
With interest rates still low by historical standards throughout the developed world, income-seeking fixed income investors are embracing alternatives to traditional government debt. That includes emerging ...
One of the hottest corners of the fixed income market is positioned to continue delivering upside as the U.S. dollar remains lethargic and bond investors continue embracing higher-yielding opportunities. ...