Barings launches emerging market debt fund

IndiaBaring Asset Management has launched a fund investing in emerging market investment grade and non-investment grade corporate debt.

The Baring Emerging Markets Corporate Debt fund aims to maximise total return from income, capital appreciation and through the use of a currency overlay.

Fund manager Faisal Ali says at least 70% of the overall portfolio will be invested in emerging markets.

Allocation is likely to be tilted towards countries where Ali expects strong growth fundamentals and robust domestic demand.

Ali says he favours India’s domestic dynamics and low export dependence as well as some of the debt issued by Brazilian companies, which often have direct exposure to a fast-growing middle class and rising real wages.

The fund is denominated in dollars and uses a currency overlay to hedge the exposure back to local currencies.

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