Here is what BofA Merrill Lynch’s Jon Maier wrote recently about an emerging markets debt ETF:

“We initiate Emerging Markets Domestic Debt Fund (NYSE: EDD) at Buy due to its attractive yield [curr yield is 6.7%] and valuation [6% discount], as well as our view that for local currency emerging market bonds, country and currency exposure will likely work in the favor of dollar-based investors in the coming years. Emerging market economies have been growing faster than developed economies for about the past decade, and the local currency debt has higher yields, lower interest rate risks and is of higher credit quality than US dollar denominated debt. The tradeoff is currency risk.”

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