EMCB - Asia's New Balance: High-Yield Market Offers More Diversity Lower Risk
2024-06-28 06:00:00 ET
Summary
- The Asian high-yield market is evolving faster than investor perceptions.
- China may no longer be the global growth powerhouse it once was, but its GDP growth remains well ahead of Western economies’, as does the growth of India, Indonesia, and Asia generally, presenting a significant opportunity for global investors.
- High-yield bond investors may view the prospect with mixed feelings, given the Asia high-yield market’s poor performance after Chinese real estate companies began defaulting on their debt in 2021.
- With a more balanced risk/reward profile and strong growth prospects, we think the Asia high-yield market offers investors the benefit of diversification and the potential for positive returns.
By Diwakar Vijayvergia & Thierry V. Taglione, CAIA
The Asian high-yield market is evolving faster than investor perceptions.
After a turbulent few years caused by the shakeout in China's property sector, the Asia high-yield bond market has found a new equilibrium based on sound fundamentals, attractive valuations and strong returns. We think it's time for investors to consider its growth potential and diversification benefits....
Asia's New Balance: High-Yield Market Offers More Diversity, Lower Risk