Key Investment Factors

The Emerging Markets, current as of 1996:

  • 45 Nations classified as Emerging Economies
  • Total Outstanding: $350 Billion
  • Population of about 2.6 Billion (1992), is in excess of 2/3 of world's total
  • GDP of $3.5 Trillion (1991)
  • Growth rate of 5% (1991)
  • Most economically diverse group
  • Fastest growing region
  • Economies and infrastructure substantially underdeveloped

How Emerging Markets Debt compares to other non-investment grade instruments:

  • Total return range of between -17% to +32%
  • Yield pickup due to risk premium (high yield spread to US Tsy)
  • Opportunity for capital gains: deeply discounted
  • Comparable to US high yield market
  • As portfolio diversification tool to achieve favorable returns relative to substantial risks