No. of Recommendations: 3
What I like about these articles is that they explain why very few took the risk 10 - 15 years ago and at the same time state that the group out performed over that period. Meanwhile the article does not come straight out an say that the only way to get those kinds of returns again is to capitalize on the next emerging markets crisis.

The article does state that current spread of a basket of emerging market over US Treasuries (oddly ignoring maturity) is 350 basis aka 3.5%. So US 10 year = 3% + 3.5% = 6.5%; is that enough of a premium to warrant local currency and economic/political risks? YMMV

Are there any capital gains left to capture?

Anyway, if anyone focused on that eye boggling 11.4% they need to keep in mind that 11.4% WAS possible if one was willing to invest on the risk/reward of emerging market debt recovery from junk to near or at investment grade levels. If anyone wants to attempt to capture those kinds or returns again then they need to find a similar risk/reward scenario which currently doesn't exist in the current funds.

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