Emerging Markets

Key characteristics: • Qualitative research enhanced by quantitative analytics • Asset type agnostic, relative-value approach • Diverse and experienced team

Emerging Markets Overview

The Emerging Markets team has over 20 years of experience navigating business cycles across emerging markets and striving to capitalize on market dislocations. Portfolios are managed using a team-based approach that draws on the fundamental research of our robust global research platform, including a dedicated sovereign and emerging markets research team. Using a disciplined and repeatable investment process, the investment team’s long-term perspective focuses on outperforming the benchmark over full market cycles and delivering competitive risk-adjusted returns. 

Aegon AM US Emerging Markets Strategies

Strategy

AuM*

Inception date

Emerging Markets Debt Global Diversified $484million April 1, 2006
Emerging Markets Debt Blended $105 million November 1, 2016

*As of September 30, 2018

Philosophy

Emerging markets portfolios are managed according to three main guiding principles. We believe:

  • Country selection is the largest driver of returns. Therefore we opportunistically allocate across countries first, and issuers and securities second.
  • Asset prices deviate from fundamental value. As such, we conduct rigorous analysis on the interaction of fundamentals and price. This includes disciplined relative-value analysis at the country, issuer and security levels. 
  • Markets over- and underreact to new information. We balance the long-term structural path for each country with market sentiment to help oscillate risk within the portfolio. 

 

Investment Process

The investment process starts with a top-down, fundamental evaluation of the individual emerging market countries in the investment universe. This process is informed by the internal, global house view. The team then compares its understanding of these fundamentals with sovereign pricing and further down to security level pricing. 

 

Distinguishing Characteristics 

The emerging market debt strategies benefit from our in-depth resources, relative-value approach, and experienced research team. Specifically, the strategy is differentiated from its peers in three key areas:

  • Qualitative research enhanced by quantitative analytics. Applying both a qualitative and quantitative perspective to our research, cogitative biases are minimized. Quantitative analytics complement our qualitative assessment of countries’ economic strength.
  • Asset type agnostic, relative-value approach. Country performance is ultimately the largest driver of our portfolios’ returns, therefore we opportunistically allocate across countries first, and issuers and securities second. To best express our country views, our research team focuses on a broad range of securities across markets and issuers.
  • Diverse and experienced team. Portfolio managers are supported by the dedicated Global Sovereign and Emerging Markets Research team. Additional resources include industry-focused credit analysts and a distressed research team with significant experience analysing downside scenarios. Outside of credit, the EM team’s research experience includes macro-economics and currencies. Averaging 20 years of industry experience, several members of the EM Debt team have experienced multiple market cycles.