New perspectives on emerging market bonds - Looking beyond the current crisis.

This article examines the role of emerging market bonds in global investmen t portfolios. The authors explore the history of these bonds and examine ex pected returns, risk, and higher moments with data extending through time e merging market crash. The authors find that country risk measures are valua ble in explaining expected returns and volatilities in these markets. They also argue that the high expected returns are compensation for large negati ve skewness risk.