Interactive Investor

ii Super 60 investments:M&G Emerging Markets Bond

Asset GroupAsset Sub-GroupInvestment Category
Fixed IncomeGlobal bondsAdventurous

The fund has been managed by Claudia Calich since December 2013, taking over from Mike Riddell. She has over 20 years’ experience in emerging markets. She has been supported by deputy manager Charles De Quinsonas since 2015. He has more than 10 years of emerging market corporate bond experience, with a deep knowledge of high yield credit. They are supported by a team of dedicated emerging market debt analysts and other public credit analysts.

This is a very flexible strategy, with the manager unrestricted in allocating the fund’s assets between the three main emerging market bond sub-asset classes of hard currency sovereign, local currency sovereign and hard currency corporate bonds, as well the flexibility to move across the emerging market credit and duration spectrums. 

Calich makes asset allocation calls between these asset classes and blends high conviction macro calls with fundamental credit analysis. Currency allocations are also used as an additional source of returns, and a neutral position consists of about 67% allocated to the US dollar, as per the composite benchmark of 2/3 hard currency, 1/3 local currency.

Along with an assessment of the global macroeconomic outlook, the process begins with a sovereign outlook including liquidity and solvency, external accounts, and political factors. Calich combines her high-conviction macro calls with fundamental credit analysis from M&G’s dedicated emerging market bond analysts. 

The fund’s duration will typically be between 0 and 10 years but cannot go negative, with a neutral position of 5-6yrs. There are no credit quality restrictions either.

The fund’s returns over Calich’s tenure have been excellent, outperforming its benchmark and the peer group. Outperformance has also been remarkably consistent, outperforming both comparators every year except for 2018 and 2020.

Opinion
Calich is a highly experienced emerging market debt investor and can draw on an extensive amount of analytical resource from M&G’s credit analyst team.

She has used the flexibility of the strategy to great effect and performance has been good in a variety of market conditions.

January 2023

Risk warnings

Past performance of the underlying constituents is not a guarantee of future performance. The value of investments, and any income from them, can fall as well as rise so you could get back less than you invest. 

Annual performance can be found on the factsheet of each fund, trust or ETF. Simply click on the asset’s name and then the performance tab. 

The information we provide in the ii Super 60 investments list is an opinion provided by ii or one of its partners on whether to buy a specific investment. Please note that none of the opinions we provide are a “personal recommendation”, which means that we have not assessed your investing knowledge and experience, your financial situation or your investment objectives. Therefore you should ensure that any investment decisions you make are suitable for your personal circumstances.

If you are unsure about the suitability of a particular investment or think that you need a personal recommendation, you should speak to a suitably qualified financial advisor. 

Any changes to the ii Super 60 investments list and the rationale behind those decisions will be communicated through the Quarterly Investment Outlook.

Details of all recommendations issued by ii during the previous 12 month period can be found here.

ii adheres to a strict code of conduct. Members of ii staff may hold shares in companies mentioned in the ii Super 60 investments list, which could create a conflict of interest. Any member of staff intending to complete some research about any financial instrument in which they have an interest are required to disclose such interest to ii. We will at all times consider whether such interest impairs the objectivity of the recommendation.

In addition, staff involved in the production of this ii Super 60 list are subject to a personal account dealing restriction. This prevents them from placing a transaction in the specified instrument(s) for five working days before and after an investment is included or amended and made public within the list. This is to avoid personal interests conflicting with the interests of the recipients of this ii Super 60 investments list.