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Taper-Tantrum Woes Fuel Hunt for Foolproof Emerging Markets

  • William Blair, Fidelity buying high-yield and frontier bonds
  • Developing nations have to ‘navigate’ Fed’s taper talk: SEB
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The debate about when the Federal Reserve will start scaling back bond purchases is driving some investors to emerging-market assets less exposed to a potential surge in U.S. yields.

William Blair Investment Management and Fidelity International are bulking up on high-yield or frontier bonds that are less sensitive to U.S. interest rates. Meantime, Bank of America Corp. is recommending that investors scoop up emerging-market euro-denominated bonds, predicting yields in the common currency will remain stable even when the Fed unveils plans to scale back its bond-buying campaign, probably in September.