Emerging market bonds are issued by governments or companies in developing countries. Emerging market bonds typically pay higher yields than investment-grade bonds in both Canada and the U.S. This extra yield pays investors for the added risk of investing in countries with shorter records of sound economic policies and less established institutional and governmental frameworks.
In recent years, many emerging market countries have adopted conservative banking and regulatory regimes – similar to those in Canada – which have reduced the risk and increased the credit quality of their bonds.
To learn more about funds we offer that invest in emerging market bonds, see:
RBC Emerging Markets Bond Fund
RBC Global High Yield Fund