Why This Strategy: Addressing uncompensated risks in EM bonds
We believe an active, quality-enhanced, income-seeking strategy is a more efficient approach to Emerging Market bond investing than traditional benchmark replicating strategies.
In our view, traditional Emerging Market bond benchmarked strategies can be exposed to uncompensated risks, especially from exposures to lower-rated countries and issuers and FX volatility, which exposes investors to unnecessary risk.
Our active selection decisions reflect strategic and tactical insights that dynamically prioritise quality, avoid uncompensated risk, and align the strategy’s outcome with fixed-income investors' expectations. We hedge currency exposure for Sterling (EBGA LN & EBGD LN) and Euro-based (Unlisted classes) investors to mitigate currency risk and volatility of currency fluctuations. We provide US Dollar unhedged (EBUA LN & EBUD LN) access for global portfolios.
What makes us different?
1. An active ETF, designed differently
A truly active Emerging Markets Bond UCITS ETF, with listed and unlisted classes for direct access and platform-based model portfolios. (EUR unlisted classes available. GBP unlisted classes to launch in H1 2025).
2. A strategic approach to Emerging Market bonds
We pursue uniformity of quality, actively address uncompensated risk, and align the strategy's outcomes with fixed-income investors' expectations.
3. A quality-enhanced focus
We focus on maximising yield per unit of quality across credit ratings, ESG factors, country exposures, and fundamentals.
4. World-renowned macroeconomic & FX experts
Stephen Jen and Fatih Yilmaz are globally recognized for their deep expertise in macroeconomics and FX strategies, driving Eurizon SLJ’s research-led investment approach.
5. Academic rigour & diversity of thought from Emerging Markets specialists
Our London-based team includes 4 PhDs, 7 MScs, spans Baby Boomers to Millennials, and is 58% female, blending academic excellence, generational diversity, and strong gender representation.
An active approach to Emerging Markets Income
Matt Jones
Head of Distribution
"We are delighted to have listed our quality-enhanced active EM bond ETF on the London Stock Exchange. The fund aims to offer investors transparent, cost-effective, and flexible access to EM bond income with developed market risk characteristics, managed by a diverse team and backed by our research-led approach to investing. Emerging Market bonds present an exceptional opportunity for UK investors. As developed markets enter the early stages of a rate-cutting cycle, the yield advantage of EM bonds, their diversification benefits, and the ability of UK investors to access GBP-hedged classes enhance their attractiveness as a complementary income source. It is an exciting time for active ETFs in Europe, and we see growing demand for high-conviction bond ETFs, either as a complement to passive funds or an outright allocation."
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