As Asian private sector debt levels rise to 1997 highs, investors may want to watch out for potential risks in emerging Asia bond-related exchange traded funds.

The combination of high leverage, with emerging Asia debt more than doubling to $21 trillion over the past five years, and notoriously low liquidity in emerging Asia could weigh on Asia debt when the markets turn sour, reports Henny Sender for Financial Times.

Investors may want to keep tabs on he WisdomTree Asia Local Debt Fund (NYSEArca: ALD), an actively managed ETF that tracks local debt denominated in currencies of Asia Pacific ex-Japan countries. ALD has gained 4.1% year-to-date. [ETF Spotlight: Active Asia Debt]

Additionally, other broad emerging market bond ETFs include significant Asia exposure. For instance, the iShares J.P. Morgan USD Emerging Markets Bond ETF (NYSEArca: EMB) has a 4.5% weight in China, 5.3% in Indonesia and 5.5% in the Philippines. [EM Bond ETFs Firm as Issuance Soars]

The region has been able to support its high debt burden, with large foreign capital inflows and current account surpluses.

However, market observers have pointed to an end of easy money from the Federal Reserve and heightened global volatility, which have weighed on emerging market debt and their respective currencies since the July high.

Some also argue that corporate Asia is more vulnerable than sovereign debt since many Asian companies have benefited from the Fed’s near-zero rate policies, which will likely end soon.