EMLC tracks emerging market bonds denominated in the local currencies, or in the currency of the issuing country. Consequently, investors are exposed to currency risks. However, the assets look more attractive when the U.S. dollar depreciates or the emerging market currencies strengthen.
Alternatively, HYEM targets USD-denominated speculative-grade emerging-market bonds. Consequently, the ETF negates the effects of currency risks. If the U.S. dollar continues to appreciate, HYEM could outperform local-currency-denominated bonds.
Lastly, EMAG includes a combination of U.S. dollar-, euro- and local currency-denominated bonds.
Financial advisors who are interested in learning more about investing in emerging market bonds can register for the Thursday, October 9 webcast here.
For the lucky few advisors who have opted to fill out a survey at the end of the webcast, five randomly chosen winners will receive a free Janet Yellen tie in all its stately splendor.