Emerging Market Bond Funds: Flow-Performance Relationship and Long-Term Institutional Investors
6 Pages Posted: 22 May 2019
Date Written: April 2019
Mutual funds investing in emerging market economy (EME) bonds have increased almost seven-fold since the 2008 Great Financial Crisis (Graph 1). This development has raised two questions from a financial stability perspective. Firstly, how important is it to understand the fund-flow performance relationship in which overperforming funds encourage inflows and underperforming ones outflows? And secondly, can long-term institutional investors (LTII) such as pension funds and insurance funds be considered a stabilising force during market sell-offs?
Full Publication: Asia-Pacific Fixed Income Markets: Evolving Structure, Participation and Pricing
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