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  • msf February 17
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JPMorgan Chase to Add Ukraine Bonds to Popular EM Index - Despite War Threat (WSJ)

edited February 17 in Other Investing
Hundreds of millions of dollars from foreign investors are likely to flow into Ukrainian bonds next month despite the threat of war with Russia. JPMorgan Chase & Co. is planning to add Ukraine’s local-currency debt to a popular emerging-market bond index known as the GBI-EM. It will come into effect from March 31 with a weighting of 0.12%, according to an October 2021 note to clients, which said close to 70% of investors supported the move. A person familiar with the matter said this plan is still on track. JPMorgan declined to comment.

Funds managing $222 billion used this index as a benchmark as of January. If they all decide to add the Ukrainian bonds, that would mean an inflow of $266.4 million into the market. “This is good news for Ukraine. All of a sudden you’ll have big index players channeled toward that particular bond market,”said Monika Dutt, head of a passive strategies research team at Morningstar Inc.

Excerpted from: The Wall Street Journal (print edition) February 16, 2022


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