Searching for attractive returns in emerging market debt
With over 26 years’ experience in emerging market debt (EMD) investing, we manage USD $9.1 billion of assets across a range of strategies that span the EMD universe (as of 28 February 2026). These include pooled sovereign bond strategies both in ‘hard-currency’ (mostly US dollar denominated) and local currency, hard-currency corporate bond strategies, as well as bespoke, blended and segment-specific long-only and total return solutions.
Why invest?
EMD represents a critical, yet underappreciated, component of global fixed-income portfolios. As the asset class grows in significance, driven by stronger fundamentals and favourable macroeconomic conditions, it offers investors a powerful opportunity for diversification and yield enhancement. Given the breadth and diversity of the EMD universe, investing with an unbiased, flexible and disciplined approach can help to identify the most attractive opportunities.
Diversification
EMD provides access to regions and countries across sovereign and corporate issuers in hard and local currencies. Each segment has unique risk and return drivers, helping to provide diversified returns for investors.
Structural advantages
EMD investing taps into higher economic growth rates, lower debt and other factors such as positive demographics and rapidly expanding consumerism.
Alpha opportunities
Inefficiencies within EMD create opportunities for active managers across countries, issuers, yield curves and currencies.
Disciplined approach
Our approach seeks to offer the potential to achieve a smoother path of strong risk-adjusted returns and can be attractive for investors seeking to build a strategic allocation to an asset class.
Investment philosophy
We believe opportunities exist across the entire investable universe – not just within the higher-yielding segments of the market. We harness our experience to better understand the idiosyncratic risks across sectors and prioritise a balanced approach to portfolio construction, targeting diversified sources of return with a constant focus on risk and reward.
Unbiased & balanced
In our view, there are long standing and significant structural biases within the EMD manager universe, leaving investors overly exposed to the riskiest issuers. Our approach seeks to utilise the full breadth of opportunities, without any predetermined risk biases.
Risk astute
Emerging markets exhibit high levels of idiosyncratic risk and are characterised by periods of high volatility that many traditional risk metrics fail to capture. A deep understanding of emerging market-specific risks, combined with a blend of traditional and non-traditional risk metrics, we believe is crucial to delivering superior client outcomes.
Robust portfolio construction
Our proprietary risk allocation process uses custom portfolio sectors to provide a clear separation between market and asset-specific risk and exposure, enabling portfolios to perform throughout the market cycle.
Investment insights
Investment thinking that brings together the collective insight of Aviva Investors’ teams from across the globe on the key themes influencing markets.
Views
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Rethinking risk in EMD: The great inversion on emerging markets
28 Nov 2025
Market and economic trends are challenging the idea that emerging market (EM) bonds should trade at a discount to developed economy debt.
Bond Voyage
House View
House View
Market insights, economic analysis and investment perspectives to help investors understand the trends, risks and opportunities shaping global markets.
Key risks
Investment/objective risk
The value of an investment and any income from it can go down as well as up. Investors may not get back the original amount invested.
Currency risk
The fund is exposed to different currencies. Derivatives are used to minimise, but may not always eliminate, the impact of movements in currency exchange rates.
Emerging markets risk
Investments are made in emerging markets. These markets may be volatile and carry higher risk than developed markets.
Credit & interest rate risk
Bond values are affected by changes in interest rates and the bond issuer's creditworthiness. Bonds that offer the potential for a higher income typically have a greater risk of default.
Derivatives risk
Investments can be made in derivatives, which can be complex and highly volatile. Derivatives may not perform as expected, meaning significant losses may be incurred.
Illiquid securities risk
Some investments could be hard to value or to sell at a desired time, or at a price considered to be fair (especially in large quantities). As a result their prices can be volatile.
Sustainability risk
The level of sustainability risk may fluctuate depending on which investment opportunities the Investment Manager identifies. This means that the strategy can be exposed to Sustainability Risk which may impact the value of investments over the long term.
Counterparty risk
The Fund could lose money if an entity with which it does business becomes unwilling or is unable to meet its obligations to the Fund.
Emerging market debt team
A dedicated EMD team with over 20 years' experience in designing and managing the full spectrum of EMD products.
Aaron Grehan
Head of Capital Opportunities Group and Co-Head of Emerging Market Debt
Michael McGill
Co-Head of Emerging Market Debt and Senior Portfolio Manager
Kurt Knowlson
Senior Portfolio Manager
Devin Cameron
Portfolio Manager
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