Vanguard Emerging Markets Government Bond ETF

VWOB tracks a market value weighted index of emerging market sovereign debt, denominated in USD.

Emerging markets bonds issuance is already reaching record highs early in 2024. The Financial Times reported that EM debt issuance is already at $50 billion, opening opportunities in EM bond ETFs.

Get Exposure to Emerging Markets Bonds Amid Record Issuance

Investors looking for a comeback story in 2024 might want to give emerging markets (EM) bonds a closer look. As the capital markets anticipate rate cuts in the new year, this could translate to strength for EM bond prices.

Emerging Markets Bonds Could Stage a 2024 Comeback

The anticipation of lower interest rates may cause some concern about falling yields for fixed income investors. But there are other options to consider, such as emerging markets bonds.

Bonds in Emerging Markets Are an Enticing Yield Option in 2024

In many ways, this US-led tightening cycle is different for emerging markets. Yet, emerging market bonds have perhaps been too resilient in the face of rising US yields. As relative yields normalize, VWOB's emerging market bond portfolio could suffer rate-driven downside from here.

VWOB: Emerging Market Bonds Are At The Mercy Of 'Higher For Longer'

The U.S. Dollar Index is down just under 5% within the past year, which should clear the path for interest in emerging markets (EM) assets like bonds again. Typically, strength in EM is tied to the performance of the currency of that particular country versus the dollar.

Retreating Dollar Could Spur Interest in EM Bonds Again

Investment grade emerging markets debt could be good “rainy day exposure” if the U.S. falls into a recession. At least, that's what Vanguard's co-head of emerging markets active fixed income Nick Eisinger is saying.

Vanguard: Emerging Markets Debt Could be Good ‘Rainy Day Exposure'

VWOB is an emerging market government bond index ETF. It offers a growing 5.5% dividend yield, but very few advantages relative to peers. An overview of the fund follows.

VWOB: Emerging Markets Bond ETF, Weak Investment Thesis

Moving forward, the capital markets are expecting central banks to ease rate hikes, which can turn the credit risk dial higher. That could open up opportunities in riskier assets like emerging markets (EM) bonds.

As Rate Hikes Ease, Emerging Markets Bonds Offer Opportunities

The anticipation of more rate hikes by central banks amid stubborn inflation could be fueling an amplified shift to emerging markets (EM) debt. Latin American bonds, for example, are already seeing interest, per a Financial Times article.

Interest in Latin America Could Hint at Rising EM Debt Demand

Macroeconomic headwinds like rising interest rates and inflation have stifled a comeback for emerging markets (EM). However, more firms are becoming bullish on EM bonds again.

Is it Time to Reconsider Emerging Markets Bonds?

Investors unnerved by this year's spate of bank failures understandably are looking for shelter-from-the-storm ideas. Surprisingly, emerging markets bonds could fit that bill.

In This Emerging Markets Bonds ETF, Surprising Fixed Income Protection

VWOB owns a portfolio of government bonds in the emerging markets. Emerging markets may become more stabilized as the Federal Reserve's rate hike cycle likely comes to an end in H1 2023.

VWOB: You Should Buy U.S. Treasury Instead

When it comes to emerging markets bonds, many fixed income investors face a conundrum. They're attracted to the asset class by yields that are well above those found on developed world sovereign debt, but they're apprehensive regarding the elevated risk profile associated with developing world bonds.

Breadth, Quality Matter With Emerging Markets Bond ETFs

Declining inflation and China reopening its economy has led overseas debt issuance to soar. In turn, improving economic conditions are spurring investors to pump money into emerging markets debt at a record pace.

Emerging Markets Debt Sees Record Inflows in January

VWOB provides exposure to emerging market sovereign bonds. The ETF has a trailing 12 month yield of 5.3%.

VWOB: May Be Better To Stick With Domestic High-Yield Bonds

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Expert recommendations for choosing among the myriad of Vanguard ETFs may prove to be a valuable resource to investors, even if not all of them will prove right. I present such recommendations made by highly knowledgeable sources, along with my own recommendations and the reasons for them.

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Even for the safest debt, last year's bond market was a forgettable one, but opportunities are arising now that investor confidence is brimming to start the year. That's feeding into investor interest for riskier debt once again, including emerging markets (EM).

Investors Are Soaking Up Emerging Markets Bonds in Early 2023

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This time a year ago, fixed income funds were seeing some “pretty hefty outflows,” according to Janel Jackson, principal and global head of ETF capital markets and broker & index relations at Vanguard. Now, bond funds are seeing an influx of investor capital, thanks to high yields and strong performance.

Vanguard: Fixed Income Seeing Strong Flows, Solid Performance

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While equity markets were volatile in 2022, it was a particularly bad year for bond markets. Amid a year when the Federal Reserve was raising interest rates to battle record-high inflation, it was the worst period for fixed income in nearly a century.

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Fixed income investors know that 2022 was rough for domestic bonds. Seven interest rate hikes by the Federal Reserve will do that, but the turbulence wasn't confined to U.S. fixed income assets.

Bonds Could Be Strong Emerging Markets Bets in 2023

VWOB generated historical average yield and total return of almost 5 percent. VWOB's portfolio is not well diversified and carries some unwanted risks. Its bond investments in 20 high-risk small-sized economies doesn't make sense.

VWOB: Positive Return And Yield, But Emerging Market Concerns Remain

Investors have turned cold to emerging markets (EM) bonds for most of 2022, but they could be warming up to riskier debt again as winter draws closer. EM assets in general have faced a full-blown gust of headwinds with a stronger dollar amid rising interest rates.

Winter Is Coming, but Wall Street Is Warming Up to EM Bonds Again

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Central banks across emerging markets have reacted to elevated inflation by significantly tightening monetary policy, in some cases, well ahead of the U.S. Federal Reserve and the European Central Bank. After largely synchronized rate-hiking cycles across EM, monetary policies could once again begin to diverge among individual countries.

Peak Inflation May Hint At Peak Rates In Emerging Markets

Global inflation hasn't been kind to emerging markets (EM) assets in general, which includes bonds. While picking a bottom in the bond market (or any market for that matter) is difficult, now could be an opportune time.

Battered Emerging Markets Bonds Create Value Opportunity for Investors

Rising interest rates amid central bank tightening in the U.S. has been decimating both stocks and bonds in emerging markets (EM). Still, for the latter, EM bonds offer a way for fixed income investors to extract more yield.

News for Vanguard Emerging Markets Government Bond ETF ETF (VWOB)