The message to emerge from Euromoney's tenth annual CEE conference was that investors are increasingly attracted to local-currency bonds as a source of returns in a general spread-tightening environment.
Matthias-Leonard Lang, fund manager at KTL, says: ?The full monty convergence play is the local currency play. You get three sources of yield from that play. You get higher return from the coupon. You get improving yields. And you get currency appreciation.?
Lang cites Romania as an example of his play. Spreads on its local currency bonds have tightened by 100 basis points over the past...
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