HSBC launches LatAm debt and Asian bond funds

HSBC Asset Management has announced a double fund launch to capitalise on opportunities in Latin American debt and Asian currencies.

The HSBC GIF Latin American Local Debt fund will invest mainly in investment grade and non-investment grade Latin American bonds, both government and corporate. It will be managed by Octavio Ferreira who currently runs the firm’s Brazillian bond fund.

With the region’s debt market expanding, Ferreira believes that a dedicated fund combining both top-down and bottom-up fundamental analysis is the best way to capture this growth.

The second launch is that of the HSBC GIF Asian Currencies Bond fund, which will also invest in investment grade and non-investment grade bonds issued by governments and corporations.

The Asian bond fund will be managed by Cecilia Chan, the firm’s CIO of Asia-Pacific fixed income, and Alfred Mui, investment director of fixed income, and will be denominated in Asian currencies as well as US dollars.

‘Relatively strong GDP growth rates continue to attract foreign direct investment, which combines with sound economic fundamentals to strengthen local currencies and provide attractive opportunities in Asian fixed income markets,’ said Chan.

‘The market for emerging East Asian currency debt was valued at US$4.6 trillion during the first quarter of 2010 and grew at an annual rate of 17%. Allocations to Asian local-currency debt have increased this year as investors seek higher yields than those available in the US and Europe, where interest rates are at record lows.’