Emerging Markets Debt Total Return

A concentrated, high conviction, unconstrained approach to emerging markets debt that allows the use of leverage.

The Emerging Markets Debt Total Return strategy is an unconstrained, total return approach to investing in emerging markets debt, focusing on high conviction ideas across the asset classes: sovereign credit, corporate credit, local duration and foreign currency (FX). The strategy is intended to capture the expected return from the high conviction positions held among the various emerging markets debt portfolios that Stone Harbor manages.

Opportunities within this strategy may include:

  • Improving credit stories
  • Monetary policy cycles
  • FX valuation themes
  • Technically-related undervalued credit

The strategy is driven by our fundamental analysis and is complemented by top-down macroeconomic views. Country and currency decisions are based on our disciplined investment process, which includes an assessment of macroeconomic fundamentals, policies and politics, as well as the attractiveness of spreads, currencies and interest rates. Corporate investment decisions combine judgments of the relative attractiveness of industries with the credit fundamentals of individual companies.

The Emerging Markets Debt Total Return strategy offers opportunistic exposure to a large, investible asset class through an unconstrained blend of the different emerging markets asset classes. The allocations may vary significantly as Stone Harbor’s fundamental credit views, macroeconomic outlook and valuations change. The strategy may contain leverage of 0%-33% of total assets at the time of borrowing.