The “most hated asset class of the last few years” will be the best performer in 2016, argues Jan Dehn, head of research at UK fund house Ashmore.
Asset managers weigh the impact of China being included in key global debt indices, which they expect to start seeing this year, after the mainland bond market opened further last month.
The emerging markets fund house underlines the scheme’s appeal after becoming the first manager outside of Hong Kong to gain an RQFII licence.
Hedge funds, urged by banks to buy big into EM debt ahead of Japanese institutions, were left high and dry, says the UK fund house's co-head of research.
But this approach by developed-country governments is allowing emerging-market banks to take the lead in servicing investors in their local debt markets, argues Jan Dehn.