Latin Finance - July/August 2009 - 11

fund performance And Jones claims that EM funds actually held up better than a lot of people expected them to in 2008. “There’s a momentum element to indexes,” says Bill Rocco, senior equity fund analyst at Morningstar. He says a market-cap weighted index might have an advantage in a rapidly rising market. Stocks that do well by definition see market cap increase, and it might not be practical for managers to keep up with the enlarged positions. On the way down, however, a manager might be able to go lighter on stocks than an index can, notes Rocco. Rocco says investors are better off in a broad emerging markets fund rather than a region-specific one. “It’s great to be in emerging Asia or Latin America when it’s outperforming, but the inverse is true when it’s not.” Managers blame internal limits and exposure to less liquid markets like local currency and corporates. “Funds that had higher off-index exposure to corporates and local markets tended to outperform in the past, but may have been more hurt in the selloff,” says Cristina Panait, EM strategist at Payden and Rygel. Payden’s $95 million – as of May 1 – Emerging Markets Bond Fund showed annualized total three and five-year returns nearly even with the EMBI Global Diversified index through the end of May. However, Lipper’s EM bond average still trails JPMorgan’s corporate CEMBI Diversified index’s one year loss of 0.02%, and five-year returns of 9.09%. JPMorgan’s GBI-EM Diversified index, which tracks local market debt, posted a year loss of 0.04% and five-year returns of 19.93%. Game Changer “What was really a game changer for us in terms of performance was what happened the last three to four months of 2008,” says Luz Padilla, group managing director for EM debt at TCW, which manages $1.5 billion in the asset class, including a $23 million Emerging Markets Income Fund. “April and May [2009] took out a lot of the risk premium that had been added in the latter part of 2008,” Padilla adds. TCW is focused on credits it expects to perform well even in the worst of circumstances, for example quasi-sovereigns and others with government support. TCW’s July/August 2009 LatinFinance 11

Latin Finance - July/August 2009

Table of Contents for the Digital Edition of Latin Finance - July/August 2009

Latin Finance - July/August 2009
Contents
Fund Performance
Compensation Survey
Sellside Startups
Eike Batista Interview
Private Equity
Private Banking
BNDES Lending Analysis
Equador Mining
Corporate Governance
Parting Shot
Latin Finance - July/August 2009 - Latin Finance - July/August 2009
Latin Finance - July/August 2009 - Cover2
Latin Finance - July/August 2009 - Contents
Latin Finance - July/August 2009 - 2
Latin Finance - July/August 2009 - 3
Latin Finance - July/August 2009 - 4
Latin Finance - July/August 2009 - 5
Latin Finance - July/August 2009 - 6
Latin Finance - July/August 2009 - 7
Latin Finance - July/August 2009 - 8
Latin Finance - July/August 2009 - 9
Latin Finance - July/August 2009 - Fund Performance
Latin Finance - July/August 2009 - 11
Latin Finance - July/August 2009 - 12
Latin Finance - July/August 2009 - 13
Latin Finance - July/August 2009 - 14
Latin Finance - July/August 2009 - 15
Latin Finance - July/August 2009 - Compensation Survey
Latin Finance - July/August 2009 - 17
Latin Finance - July/August 2009 - 18
Latin Finance - July/August 2009 - Sellside Startups
Latin Finance - July/August 2009 - 20
Latin Finance - July/August 2009 - Eike Batista Interview
Latin Finance - July/August 2009 - Private Equity
Latin Finance - July/August 2009 - 23
Latin Finance - July/August 2009 - Private Banking
Latin Finance - July/August 2009 - 25
Latin Finance - July/August 2009 - BNDES Lending Analysis
Latin Finance - July/August 2009 - 27
Latin Finance - July/August 2009 - 28
Latin Finance - July/August 2009 - 29
Latin Finance - July/August 2009 - Equador Mining
Latin Finance - July/August 2009 - 31
Latin Finance - July/August 2009 - 32
Latin Finance - July/August 2009 - 33
Latin Finance - July/August 2009 - Corporate Governance
Latin Finance - July/August 2009 - 35
Latin Finance - July/August 2009 - 36
Latin Finance - July/August 2009 - 37
Latin Finance - July/August 2009 - 38
Latin Finance - July/August 2009 - 39
Latin Finance - July/August 2009 - 40
Latin Finance - July/August 2009 - 41
Latin Finance - July/August 2009 - 42
Latin Finance - July/August 2009 - 43
Latin Finance - July/August 2009 - 44
Latin Finance - July/August 2009 - 45
Latin Finance - July/August 2009 - 46
Latin Finance - July/August 2009 - 47
Latin Finance - July/August 2009 - Parting Shot
Latin Finance - July/August 2009 - Cover3
Latin Finance - July/August 2009 - Cover4
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