EDF: 10.9% Yield From This EM Fund

Binary Tree Analytics
5.15K Followers

Summary

  • With a 10.9% dividend yield, the fund is very appealing for income-oriented investors.
  • The fund has a broad mandate being able to invest in both sovereign and corporate EM bonds in hard currency as well as local currency.
  • The fund takes significant credit risk exposure with an overweight below investment grade portfolio and large Argentina concentration.
  • EDF is highly cyclical with very deep corrections that can negate an entire decade of dividend distributions.
Rush hour captured with blurred motion in the heart of the business district of Jakarta in Indonesia

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Investment Thesis

Stone Harbor Emerging Markets Debt Fund (NYSE:EDF) is a closed end fund seeking to maximize total returns by investing in emerging market debt. The fund has a broad mandate being able to invest in sovereign and corporate EM

This article was written by

5.15K Followers
With an investment banking cash and derivatives trading background, Binary Tree Analytics ('BTA') aims to provide transparency and analytics in respect to capital markets instruments and trades. BTA focuses on CEFs, ETFs and Special Situations, and aims to deliver high annualized returns with a low volatility profile. We have been investing for over 20 years after obtaining a Finance major at a top university.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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