Iraq: Sovereign’s bonds offer possible source of alpha

At least that’s the view of Mike Conelius, emerging markets portfolio manager at T Rowe Price, in Baltimore.

The continuing violence and political instability in the country are, at first glance, reasons to steer well clear but from a financial viewpoint the sovereign’s bonds provide a possible alpha play, Conelius reckons.

In the short term, Iraq’s debt dynamics are actually highly attractive following agreements with the Paris Club of official creditors on $40 billion of debt and the London Club of commercial creditors on just under $14 billion of debt, he says.