Salman Ahmed - Chief Investment Strategist - Lombard Odier IM
Emerging market debt is on solid footing and current market valuations provide a cushion against risks such as an unexpectedly tightening of monetary policy in the US.
That said, emerging markets are a collection of very diverse economies; it follows that the impact of various risk scenarios will vary significantly from country to country. For us this means the approach to investing in the asset class has never been more critical.
Constructing a portfolio according to fundamentals rather than market cap can help to focus on quality issuers while reducing the reliance on trading. This latter point is especially important given the impaired liquidity environment.