Emerging Markets Look So Dire That Brandywine Keeps 25% in Cash
- Valuations not attractive given headwinds: Brandywine’s Arno
- EM bonds are struggling to compete with US Treasuries
This article is for subscribers only.
Brandywine Global Investment Management would rather hold cash than put more money into emerging-market bonds.
The money manager, which has $17 billion in emerging-market assets, is holding 25% of its emerging-market funds in cash, up from a normal level of 3% to 5%. Michael Arno, a Philadelphia-based money manager at the firm, said he’d rather let inflation eat into the funds’ holdings than risk bigger losses in EM bonds, which are struggling to compete with US Treasury yields.