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Our Emerging Markets Debt (EMD) team exercises a robust, consistent and collaborative investment process with the aim of achieving superior risk-adjusted returns over the longer-term.
EMD has evolved into a complex asset class and requires specialising resources to identify opportunities and risks that may be mispriced or misunderstood. We believe EMD markets reflect fundamental values over the longer-term, but can be highly inefficient over the shorter-term.
Against the backdrop of key macroeconomic and market dynamics, we focus on EM country and issuer fundamentals and relative valuations to determine our security selection and initial portfolio positioning
A strict risk management framework is used to validate our investment ideas; we use robust stress-testing and scenario analysis tools to continuously calibrate and optimize portfolio exposures
Portfolio management decisions incorporate the expertise and analysis of a large, dedicated team of EMD specialists, credit analysts and economists. The process is collaborative and dynamic: specialists are each responsible and accountable for numerous investment inputs and decisions.
We capture macroeconomic views, catalysts and investment themes together with detailed EM country and currency fundamentals and relative valuation metrics to guide our investment approach.
Reiterative risk management is a critical to our process. We continuously assess the numerous external factors impacting EMD to fine-tune our positioning and to ensure we have optimized the portfolio for acceptable risk/return trade-offs.
We assess economic and fundamental EMD drivers with relative value analytics, market dynamics and technical factors to model the initial portfolio positions
Our model portfolios then undergo rigorous stress-testing and scenario analysis to fine-tune initial position sizing/scaling as well as to recalibrate and optimize positions over time
HSBC Asset Management strengths
Emerging markets are part of our corporate DNA and we have one of the longest track records in the industry.
Our global platform connects and supports an on-the-ground network of analysts and investment professionals across the world, leveraging their extensive local knowledge and insights
EMD capabilities range from US dollar-denominated sovereign, quasi-sovereign and corporate bonds to local currency-denominated debt and local FX. We offer both benchmarked and total return strategies in this space
Getting to know opportunities in Emerging Markets
Getting to know opportunities in Emerging Markets
What are the risks?
The value of investments may go down as well as up and you may not get back the amount originally invested
Fixed income is subject to credit and interest rate risk. Credit risk refers to the ability of an issuer to make timely payments of interest and principal. Interest rate risk refers to fluctuations in the value of a fixed income security that result from changes in the general level of interest rates. In a declining interest rate environment, a portfolio may generate less income. In a rising interest-rate environment, bond prices fall
Investments in high yield securities (commonly referred to as “junk bonds”) are often considered speculative investments and have significantly higher credit risk than investment grade securities. The prices of high yield securities, which may be less liquid than higher rated securities, may be more volatile and more vulnerable to adverse market, economic or political conditions
Investments in emerging markets are by their nature higher risk and potentially more volatile than those inherent in some established markets
For more information on our EMD capabilities, contact us
Please, note that this Site is written in English only.
Categories of clients who are considered to be professionals:
Entities which are required to be authorised or regulated to operate in the financial markets. The list below shall be understood as including all authorised entities carrying out the characteristic activities of the entities mentioned: entities authorised by a Member State under a Directive, entities authorised or regulated by a Member State without reference to a Directive, and entities authorised or regulated by a third country:
Other authorised or regulated financial institutions;
Collective investment schemes and management companies of such schemes;
Pension funds and management companies of such funds;
Commodity and commodity derivatives dealers;
Locals: firms which provide investment services and/or perform investment activities consisting exclusively in dealing on own account on markets in financial futures or options or other derivatives and on cash markets for the sole purpose of hedging positions on derivatives markets or which deal for the accounts of other members of those markets or make prices for them and which are guaranteed by clearing members of the same markets, where responsibility for ensuring the performance of contracts entered into by such firms is assumed by clearing members of the same markets;
Other institutional investors;
Large undertakings meeting two of the following size requirements on a company basis:
balance sheet total: EUR 20 000 000
net turnover: EUR 40 000 000
own funds: EUR 2 000 000
National and regional governments, including public bodies that manage public debt at national or regional level, Central Banks, international and supranational institutions such as the World Bank, the IMF, the ECB, the EIB and other similar international organisations.
Other institutional investors whose main activity is to invest in financial instruments, including entities dedicated to the securitisation of assets or other financing transactions
The information presented may refer to HSBC Asset Management's global AUMs/figures and global policies. Even though local entities of HSBC Asset Management may be involved in the implementation and application of global policies, the numbers presented and the commitments listed are not necessarily a direct reflection of those of the local HSBC Asset Management entity.
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