Both DSUM and CHLC are low duration products, indicating that although their current 30-day SEC yields are not massive, those yields are fair from a duration perspective. DSUM’s effective duration is 2.43 years while CHLC’s is 1.83 years, according to Market Vectors data.
Dim sum bonds have one of the best yield-to-risk profiles as they offer a high yield per unit of duration relative to other segments of the bond market. [Dim Sum Bonds to Diversify Fixed Income Portfolios]
Still, a weaker yuan may not be all it is cracked up to be. A weaker currency does have the effect of making it cheaper to repay debt denominated in that currency, potentially a small credit positive for some issuers,” said Rodilosso. “On the other hand, holders of the dollar debt of Chinese issuers, particularly those domestically-oriented companies without significant dollar revenues, might have greater reason to be concerned from a credit perspective.”
CHLC Credit Quality