Solactive is pleased to announce the expansion of its sovereign bonds product series. With the release of the company’s new Solactive Emerging Markets Bond Index Series, the company now effectively covers both Developed and Emerging Government bond markets, and adds to its offering a broad and customizable exposure to emerging markets, optionally bearing the possibility to include ESG and or strategy overlays. As an authorized index provider under the European Benchmark Regulation, Solactive is one of the sole index providers that are able to offer a comparable index to its clients. The first company licensing two customized versions of the new Solactive Emerging Markets Bond Index Series for two ETFs is Mackenzie Investments.

The internally developed Solactive Emerging Markets Bond Index family utilizes the company’s longstanding experience in fixed income indexing. Additionally, Solactive collaborated closely with its clients in conducted market research, evaluating vital client feedback and requests to forge the new index family. Solactive’s proprietary Country Classification Schema accounts for a maximum of transparency and consistency.

“Since 2006, emerging market bonds increased in significance, and for a long time, it was one of the most commonly enquired products to our Fixed Income Product Development team,” says Jennifer Steding, Head of Fixed Income at Solactive. “With the new series, we’ve carefully listened to crucial client feedback, in order to deliver a product that is both transparent and highly customizable.”

In a low yielding environment, with deteriorating government finances in the developed world, emerging markets offer an excellent diversification opportunity relative to other asset classes.

Timo Pfeiffer, Head of Research at Solactive comments: “Historically, emerging markets have been perceived widely as being heavily indebted, with current account deficits and suffering from a strong dollar. Nowadays, any doubt on the matter seems to be dispelled entirely, as we have observed emerging market sovereigns attracting the largest inflows amongst European listed ETF in 2018. Fortunately, Mackenzie Investments recognized the potential of emerging markets bonds and created two products that facilitate access to emerging market sovereigns. We’re looking forward to future collaboration.”

Michael Cooke, Senior Vice President and Head of ETFs at Mackenzie Investments comments: “We see significant potential in the emerging markets bond space for investors seeking to diversify their portfolios and access the impressive growth taking place in these countries. We’re very pleased to align our new ETFs with the Solactive Emerging Markets Bond Index Series as we feel it offers broad diversification in this segment of the market.”