:1440by571?wid=1440&hei=571&qlt=90&bfc=on&ts=1761830333585)
CONSTRUCTIVE CONDITIONS FOR EM DEBT
Emerging market (EM) debt is attracting renewed interest as macro conditions call for greater diversification and a weaker U.S. dollar aids the outlook. Yields on EM debt stand out versus other sectors at a time when investors show an appetite for income-driven returns and rate cut expectations add upside potential. Underpinning the opportunity, EM economies boast above-trend growth and broadly improved fundamentals.
FIVE FACETS OF IMPROVED EM FUNDMENTALS
Several factors have driven fundamental improvement within EM at a time when developed market fundamentals are deteriorating. EMs have benefitted from:
MAKING THE MOST OF INEFFICIENT MARKETS
PGIM’s emerging market debt solutions seek to maximise risk-adjusted returns with a relative value approach designed to capitalise on inefficiencies in emerging market fixed income and currency markets.
FEATURED FUNDS
| Fund | Morningstar Rankings | ||||
|---|---|---|---|---|---|
|
1-Yr
|
3-Yr
|
5-Yr
|
10-Yr
|
||
|
56%
541/935
|
64%
548/832
|
73%
561/749
|
|
||
|
23%
75/369
|
43%
124/324
|
24%
58/278
|
|
||
|
22%
409/1695
|
21%
361/1486
|
26%
363/1271
|
|
||
|
13%
202/1695
|
26%
474/1486
|
23%
317/1271
|
|
||
|
66%
1226/1695
|
53%
904/1486
|
2%
15/1271
|
|
||
Source: Morningstar. Morningstar measures risk adjusted returns. The Overall Rating is a weighted average based on a fund's 3-, 5-, 10-year, if applicable. Please see applicable fund page for a full list of star ratings. Morningstar category rankings are based on total return, do not include the effect of sales charges, and are calculated against all funds in each fund’s respective Morningstar category.
Equipped For Outperformance
Related Insights
-
Emerging Market Debt: Steady in The StormPGIM is cautiously constructive in its Q4 2025 Emerging Market Debt outlook.
Read More
-
The Emerging Markets "Beat" Goes OnPGIM explores the myriad reasons for Emerging Markets Debt to continue outperforming going forward.
Read More
-
The Local EM Turn: Implications of Expanding Domestic MarketsImproving governance is likely to precede sustainable growth of an emerging market country’s domestic debt market, and the following analysis highlights where local markets are thriving, and where they lag.
Read More
:560by316?wid=360&hei=200&qlt=90&bfc=on&ts=1761821789069)
Sources of data (unless otherwise noted) are as of 30/09/2025.
References to specific securities and their issuers are for illustrative purposes only and are not intended and should not be interpreted as recommendations to purchase or sell such securities. The securities referenced may or may not be held in the portfolio at the time of publication and, if such securities are held, no representation is being made that such securities will continue to be held.
The views expressed herein are those of PGIM investment professionals at the time the comments were made, may not be reflective of their current opinions, and are subject to change without notice. Neither the information contained herein nor any opinion expressed shall be construed to constitute investment advice or an offer to sell or a solicitation to buy any securities mentioned herein. Neither PFI, its affiliates, nor their licensed sales professionals render tax or legal advice. Clients should consult with their attorney, accountant, and/or tax professional for advice concerning their particular situation. Certain information in this commentary has been obtained from sources believed to be reliable as of the date presented; however, we cannot guarantee the accuracy of such information, assure its completeness, or warrant such information will not be changed. The information contained herein is current as of the date of issuance (or such earlier date as referenced herein) and is subject to change without notice. The manager has no obligation to update any or all such information; nor do we make any express or implied warranties or representations as to the completeness or accuracy.
Any projections or forecasts presented herein are subject to change without notice. Actual data will vary and may not be reflected here. Projections and forecasts are subject to high levels of uncertainty. Accordingly, any projections or forecasts should be viewed as merely representative of a broad range of possible outcomes. Projections or forecasts are estimated based on assumptions, subject to significant revision, and may change materially as economic and market conditions change.
Morningstar Ratings
The Morningstar Rating for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustments for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year(if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.
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Past performance is not a guarantee or a reliable indicator of future results.
Please click on this PGIM Funds plc disclosure link for important information.
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