Standish Mellon Asset Management, for example, liked the interest paid on Moroccan bonds. Yet, rather than buy the North African country’s dollar-denominated debt for its $2.8 billion Global Fixed Income Fund, it added securities issued in euros.

After factoring in hedging with currency forwards, the trade generated an extra 30 to 40 basis points of yield pickup, said Raman Srivastava, managing director of global fixed income.

“We definitely find a lot of opportunities in the market where you can take advantage of the same risks -- same maturity, same issuer, and you can even hedge the currency -- but you get paid a premium simply by looking at a non-dollar security,” he said. “There’s much more demand for dollar-denominated assets.”

This article was provided by Bloomberg News.

First « 1 2 3 4 » Next