| Before investing in emerging market debt, investors should understand the advantages and disadvantages of local currency versus dollar denominated. Robert Simpson, portfolio manager in the emerging market debt team at Insight Investment, says the decision to invest in either local or hard currency is dependent on environment.
“The pros of local currency investing are that the investor is able, to a certain extent, to isolate the factors that will drive interest rate markets in a country and therefore it’s less susceptible, in theory, to US Treasury moves or the whims of international capital flows,” he explains. “The more developed the country, the more developed its domestic financial institutions are and the greater proportion of domestic debt is held by domestic investors.”..........................................Full Article: Source
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