Emerging market debt investors should pay attention to history, but not expect a re-run of the late-1990s. Anthony Gillham of the Old Mutual Voyager Strategic Bond fund explains.
We all know emerging market debt had a pretty torrid 2013. But to understand just how turbulent it was, a sterling investor would have to look all the way back to 1997-98 to find something that comes close to the experience. Sterling's strength last year did nothing to help unhedged investor returns but, really, that is splitting hairs - 2013 hurt. The good news is that history teaches us that big setbacks to risky assets tend to overshoot. For example, in 1998, a sterling investor in emerging market sovereign credit would have suffered similar losses to this past year of just under 10% ...
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