Exchange-traded fund sponsor WisdomTree has launched a corporate bond ETF covering emerging market issuers across Asia, Latin America, Eastern Europe, Africa and the Middle East.
The product, dubbed WisdomTree Emerging Markets Corporate Bond Fund, will seek to maintain at least 65 percent of its holdings in investment grade assets with intermediate-term duration between two and 10 years. Listed on the Nasdaq Stock Market, the fund will charge a management fee of 60 basis points.
Western Asset Management Company, a subsidiary of Legg Mason, will serve as sub-advisor to the fund.
“These bonds are supported by the same favorable growth rates, attractive demographics, and improving fundamentals which have driven strong relative returns in emerging market assets in general,” stated Bruce Lavine, president & chief operating officer, WisdomTree.
EMCB portfolio manager Matthew Duda of Western Asset, added that the investment process for the fund begins with an assessment of macro and country-specific risks, but that “company-specific factors may drive emerging market corporate bond returns to a larger extent than country-level issues as sovereign risk trends lower in this asset class over time.”
WisdomTree currently has approximately $15.2 billion in ETF assets under management.
Tommy Fernandez writes for Money Management Executive.