Brendan McCurdy: EMD and rising US rates - some lessons from history

Emerging market debt (EMD) can help diversify a portfolio and serve as a tool in the pursuit of yield and attractive risk-adjusted returns. The late 2016 sell-off has, however, raised a question for some investors - do rising US interest rates represent a new negative factor for emerging market debt? We think the answer is no. While the possibility of nascent protectionism in the US and elsewhere is a risk we are watching closely, we believe fears of EMD sensitivity to US rates are overblown. Instead, we think this asset class's fundamentals are more closely tied to global economic gr...