Summary
The purpose of the Pool is primarily to provide access to emerging market debt investments, mainly consisting of sovereign and quasi-sovereign debt securities (both in hard currency as well as in local currency). In addition, the Manager will look to maximize the return above the benchmark in a cost efficient manner within the investment restrictions as set out herein.
The Pool is actively managed using a multi-manager approach. Individual managers and strategies are chosen on the attractiveness of their risk/reward profile to the benchmark and the ability to realise the investment objectives. The Pool has a strong focus on stability of the (excess) returns, with diversification of strategies and return drivers as one of the key components. Assessing concentration risk is an important part of the overall risk management, especially draw down risk.
Important drivers of excess returns are: country selection, currency selection, duration positioning, sector allocation and issue selection. Fundamental analysis is at the heart of the top down asset class and bottom up country research, complemented with quantitative tools to support our qualitative assessment.