Pimco, long-time leader in fixed income, has just gone on the record saying there may be some good opportunities in emerging markets. The company’s CIO sees the major turmoil in EMs, but says they offer opportunity. With all the selloffs, Pimco says “There are clearly a lot of challenges in emerging markets. But we see a little bit of value. It’s beginning to look interesting … We don’t see the same complacency in emerging markets as we do in other markets … We are more buyers than sellers”. For instance, Pimco is a major holder of Argentinian debt, and favors the country over Turkey.
FINSUM: With all the currency weakness and selloffs, there are certainly some good opportunities. However, this is an area where we may favor active management, as it takes a lot of work and insight to understand the internal dynamics of EM opportunities.