The future of the RMB

The future of the RMB

In-depth guide to renminbi globalization and potential repercussions of RMB growth

Emerging markets: special focus

Emerging markets: special focus

A cyclical blip in a structural bull market, or a fundamental re-appraisal of investment prospects in developing economies?

Pimco's Mohamed El-Erian: The emerging markets heavyweight

by Felix Salmon

As the world biggest buyer of emerging-market debt, Pimco's Mohamed El-Erian feels free to lean on banks - cajoling them into not selling new issues to hedge funds, refusing to be bumped into upsized deals and undermining issues that look set to damage his fund's investments.


Pimco's Mohamed El-Erian is the world's biggest buyer of emerging market debt
MOHAMED EL-ERIAN, the chief emerging-market bond investor at Pimco in California, likes to tell the story of a trip to Asia at the beginning of 2002. A large investor there was dipping its toes into El-Erian's market. Brazil was doing what it tries to do every January - issuing a 10-year bond. The Asian investor put in an order, received an allocation, and watched as the new bond immediately fell off a cliff, dropping three points in one day.

The fund manager reported this development red-facedly to his superior, the shell-shocked company sold the bond taking a large hit, and an important investor was lost to the asset class for the foreseeable future.

El-Erian was furious: this kind of deal gave emerging-market debt a bad name and kept large numbers of investors on the sidelines. The asset class has...


You must be a trialist or subscriber to view this content

Please Subscribe or take a Free Trial below.




SPONSORED ARTICLES

How to hedge risks in international trade

Sponsored by Nordea

How to hedge risks in international trade

Sub-Saharan Africa oil industry faces crude reality

Sponsored by FBN Capital

Sub-Saharan Africa oil industry faces crude reality

Is there life in MENA at $50 a barrel?

Sponsored by EFG Hermes

 

Is there life in MENA at $50 a barrel?