With EMB’s yield rising to 4.63% at this juncture, these products may be in more play than ever given the mass dislocation and apparent disagreement on valuation that the market is seeing currently in terms of Government and Corporate Bond issues from EM based countries like the Philippines, Russia, Peru, Indonesia, and Colombia to name a few (current top holdings of EMB).
As one might expect, equity carnage in the EM markets has rippled over into the FI space as well and it has been difficult at times in market distress to effectively liquidate EM bond portfolios absent price impact, thus the large intraday ranges recently. This environment perhaps creates even more trading opportunity at these levels, if not just a massive surge in volatility.
iShares JP Morgan USD Emerging Markets Bond
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