Threadneedle notes easing of emerging market default risk

Threadneedle's fixed income and alternative investment specialist Mark Pearce believes there are still attractive opportunities in emerging market government bonds.

Pearce says emerging market governments and central banks have helped to bring stability and reduced the possibility of default by shifting to more traditional economic and political policies. "Emerging market economies have improved dramatically over the past decade, with many countries holding foreign reserves well in excess of their external debt,” Pearce says. “Indeed, we believe that less than 5% of emerging market sovereign issuers are at any risk of default in the near term. "However, this does not apply to the emerging corporate bond market, which we feel is exposed to sign...