Muzinich & Co. Unveils Longer-Duration EM Debt Fund

Jun 1 2017 | 10:10pm ET

Corporate credit specialist Muzinich & Co. has debuted a new longer-duration emerging market strategy to complement the shorter-duration one it launched in 2013.

The new fund, named the Muzinich Emerging Market Debt Fund, was reportedly launched in response to demand from investors for exposure to the higher returns possible in regular-duration emerging market credit. 

Launched in July 2013, the company’s Emerging Markets Short Duration Fund crested $500 million in assets under management earlier this year. It invests primarily in corporate investment grade and high yield bonds with short maturities and a duration-to-worst of up to two and a half years.

The new OEIC fund will be domiciled in Dublin and will benchmark against BofAML’s Emerging Markets Corporate Liquid Index, according to an article in FT Advisor. It will aim for returns 150 basis points higher than the benchmark over a complete market cycle, and invest in debt denominated in hard currencies such as the U.S. dollar, yen, euro and sterling.

“We are seeing more opportunity for capital gains from regular duration emerging market debt, as opposed to short duration, which is more focused on capital preservation and about clipping emerging markets’ superior coupons,” said portfolio Warren Hyland to the FT. 

Founded in 1988, Muzinich is a global institutional asset manager specializing in corporate credit. The company manages more than $28 billion.


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