Recently, BlackRock hosted a “Fixed Income Roundtable” where they had several of their strategists and portfolio managers talk with the media. The lineup of speakers resembled the 2000 NY Yankees; every speaker was “hall-of-famer” or emerging “all-star” of the fixed income world. I am going to focus in the comments made by Rick Rieder and Sergio Trigo Paz.
Sergio Trigo Paz
Head of Blackrock’s Emerging Markets Fixed Income within the Portfolio Management Group
Sergio Trigo Paz repeatedly mentioned one trend which would have dramatic and long-lasting implications for emerging market fixed income investing. Insurance companies and pension funds are looking to double their investment in emerging market bonds from about 4% of their portfolios to 8%. To put this change in context, a reallocation of just 1% would mean about $480 billion dollars flowing into emerging market debt. In 2012, inflows were only around $70 billion Mr. Trigo Paz forecasts that emerging markets corporate and sovereign issuance will exceed $350 billion in 2013.
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