Franklin Templeton has launched the Franklin Emerging Markets Debt Opportunities Hard Currency Fund
The Luxembourg-registered fund will primarily invest in fixed and floating rate debt securities and debt obligations as well as supranationals located in an emerging market country and denominated in G7 currencies.
The fund will be managed by lead portfolio manager Nicholas Hardingham and portfolio managers, William Ledward and Stephanie Ouwendijk who are all London-based.
The team has managed emerging market debt since 1996 and has a track record of managing with a focus on hard currency assets since 2008.
The firm sale the fund invest in debt that is denominated in hard currencies – currencies of developed economies – but will not limit this to EUR, GBP, USD, JPY and CHF.
“Exposure will be taken from quasi-sovereign and corporate issuers, resulting in a much larger investment universe, which gives us further opportunities to add alpha,” said Hardingham.
The team will seek to control risk by focusing on the possibility that an issuer might default on its debt that could negatively influence portfolio performance, the group said.
Vivek Kudva, managing director, EMEA and India at Franklin Templeton said: “Many clients look to make their own currency calls when it comes to their emerging markets debt allocations. This strategy may appeal to investors looking for income yield and long-term capital appreciation by investing in emerging market obligations which exclude securities rated below B minus.”