Manulife announced plans to add an emerging market debt portfolio management team on TuesdayKEVIN FRAYER/The Canadian Press
The global asset management arm of Manulife Financial Inc. has been working to restructure its portfolios and improve investment offerings around the world. As part of that, the company announced plans to add an emerging market debt portfolio management team on Tuesday.
Roberto Sanchez-Dahl and Paolo Valle have joined the firm as senior portfolio managers – both have experience in emerging markets.
It is an area of investment expertise that Manulife has been interested in pursuing for some time, after filling holes in global equities and fixed income capabilities earlier this year. In an interview in March, Christopher Conkey, global chief investment officer of Manulife Asset Management, said that while the company had built up a team in Asia, it did not yet have "strong emerging markets capabilities." He described it as an area to improve on his "radar screen."
Many retail investors have turned to emerging market debt and bond funds in their hunt for yield, and interest has increased as credit ratings in some emerging economies have improved. The J.P. Morgan Emerging Markets Bond Global Index (EMBI Global), for example, is up 127 per cent since the pit of the recession in 2008.
"Emerging markets have evolved over the last decade," Yoel Prasetyo wrote in a Russell Research report on emerging market debt last year. "The asset class is now deeper and more diversified, with more countries in the benchmark. Market capitalization of the local emerging market debt has surpassed the U.S. High Yield market capitalization." There's also increasingly more investment-grade debt in this category.
But these investments can also be more volatile – the index is little changed so far this year, swinging down, and then up, by 2 per cent.
Manulife's new hires will be focused on an emerging markets debt strategy for institutional clients and parts of the wealth management businesses at both Manulife and its Boston-based U.S. subsidiary, John Hancock. In a release, the company said the team will also support other global debt strategies investing in emerging market debt.
As with the company's new hires that created a global equities team in March, both Mr. Sanchez-Dahl and Mr. Valle have joined from the same organization: privately-owned Federated Investment Management Co.