Asian fixed income in charts: Growth and resilience of the Asian bond market
- The Asian fixed income market is now an important asset class for global investors. The market has undergone transformative developments over the years, particularly with China's steady efforts to open up its capital markets to global investors, resulting in the ongoing inclusion of Chinese onshore assets into key global indices
- In some of the past market crises, Asia dollar bonds had rebounded sharply following the drawdown.
- Amidst the uncertainties in 2020, Asia bonds have fared relatively well thus far. Asia dollar investment grade bonds saw a smaller drawdown compared to global investment grade bonds and US investment grade bonds. The Asia dollar high yield bond market is also expected to have a relatively lower default rate in 2020 versus other high yield markets. In local currency bonds, China and India have thus far outperformed emerging markets as a whole
- After the recent market volatility, valuations for Asia dollar bonds have become more attractive. On a relative basis, Asia dollar bonds continue to offer a yield premium versus bonds in the US and Europe
- At HSBC Global Asset Management, we have been successfully investing in Asian fixed income markets throughout various market cycles for nearly 25 years. Since we manage one of the oldest Asia credit funds in the market, we have navigated a number of crises. Our strength in navigating the Covid-19 crisis has been evidenced by our first quartile (top) peer ranking across various periods for most of our Asian fixed income funds
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