The long and short investment strategies for emerging markets

The long and short investment strategies for emerging markets

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Colm McDonagh, head of emerging market fixed income at Insight Investment, asks how much return investors are willing to sacrifice in order to create a lower volatility emerging market portfolio.

As the popularity of long/short strategies in emerging markets grow, investors are demanding to own emerging market debt in different ways. While the bulk of emerging market investments is always going to be in long-only funds, there is a discernible shift towards portfolios managed in a different way. There has been a very definitive trend over the past year, for example, from a building block approach – investors looking for government, corporate, local and hard currency funds to determine their own mix – to those looking for more blended mandates.   Investors invariably struggle wi...

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