After a challenging few years, UK investors in emerging market debt funds were enjoying a strong 2016, until the US election dented the outlook for the asset class and made them one of the worst areas of the market to be holding.
The IA Global Emerging Market Bond sector, which was only created at the start of 2014, is one of the smallest Investment Association categories, home to just 41 funds with combined assets under management of £36.6bn.
The largest member is £6.6bn, while the smallest runs £4.5m.
While the first two years of the sector delivered some lacklustre returns – the average member made 4% in 2014 and lost 5% in 2015 – it was the fifth highest-returning in the IA peer group between the start of 2016 and late October, after making a close to 33% total return in sterling.
