Is EM debt the obvious buy for bond investors after sell-off?

Bond fund managers have been returning to emerging market debt in the last few days following the dramatic sell-off in the sector, after a strengthening dollar sent prices spiralling.

Emerging market debt has been one of the biggest losers within bond markets in the last few weeks, as the resurgent US dollar - boosted by hopes of a fast-paced recovery in the US - weighed on returns. In dollar terms, the JPM GBI EM Global Diversified index is down 4.8% in the last week alone. Credit spreads have also blown out, with the JPM EMBI Global Diversified index of EM sovereign debt widening 85bps since early May. However after such a volatile and aggressive tumble, bond fund managers are now spying opportunities in the sector. Michael Mabbutt, manager of the Liontrust...