That during a week in which S&P downgraded Brazil to the lowest possible investment-grade rating. A possible silver lining with some emerging markets bond ETFs, such as ELD and EMSH, is that although these funds are often Russia-heavy, they are also well-allocated to Brazil and Pimco, the world’s largest bond manager, sees value in Brazilian debt for long-term investors. [Pimco Sees Value in Brazilian Bonds]
Along those lines, another ETF to consider is the Vanguard Emerging Markets Government Bond ETF (NasdaqGM: VWOB), which devotes a combined 23% of its weight to Russia and Brazil. Over 77% of VWOB’s 606 holdings are rated Baa, A or AA.
WisdomTree Emerging Markets Local Debt Fund
ETF Trends editorial team contributed to this post.