Hot Demand for Frontier Debt Is Poised to Start Cooling Off
- Ivory Coast and Ghana’s bonds favored by BNP Asset, Aberdeen
- More than 40% of frontier markets are now high risk, IIF says
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Investors in frontier-market bonds are on course to get their best returns in seven years. It looks like it’ll be a lot tougher in 2020.
Some of the biggest money managers are already becoming more selective. BNP Paribas Asset Management, which oversees almost $500 billion in assets, is sticking to countries with sound fiscal management such as Ivory Coast, or those with investment-grade ratings like Kazakhstan, Uruguay and Morocco. Aberdeen Standard Investments sees opportunities to get above-market returns by buying the bonds of Sri Lanka, Ecuador and Ghana.