Old Stigmas Hurt Renascent EM

Burns, Mairin
May 2003
Investment Dealers' Digest;5/19/2003, Vol. 69 Issue 20, p12
Trade Publication
The search for yield in the post-Iraq war 2003 market is leading more and more investors towards the strengthening emerging markets, whose debt funds returned 6.31 percent in April 2003, higher than any other fixed-income fund class. But old stigmas and market nervousness are preventing this sector from reaching its full potential, according to emerging-market professionals. According to some investment bankers, there are several clients who denounce the emerging markets as being too risky, but own equities in these countries. Nowhere is this more obvious than in the credit derivatives market, where bankers have to battle new stigmas as well as old. Credit derivatives are securities that offer protection against the credit or default risk of bonds or loans.


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