First State launches local currency emerging debt fund

First State Investments has launched an emerging markets local currency bond fund to be managed by Manuel Cañas.

The new fund expands First State’s emerging market debt range, having launched its £43m First State Emerging Markets Bond fund - managed by Helene Williamson - in 2011.

Whereas the existing fund invests mainly in emerging market debt denominated in dollars, the new First State Emerging Markets Local Currency Bond fund will invest in bonds denominated in emerging market currencies.

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This means investors in the fund will be exposed to the appreciation or depreciation in emerging market currencies, as well as the returns generated by the underlying bonds.

First State said the new launch was the latest in its plan to build out a “full suite of emerging market debt products including external debt, local debt, corporate debt, and absolute return strategies”.

Since its launch in 2011, the Emerging Markets Bond fund is in the top quartile of the IMA Global Emerging Market Bond sector for performance.