BNP’s Asset Unit Shorts China Rate Swaps to Hedge EM Bond Bets

BNP Paribas Asset Management is using short positions in offshore Chinese interest-rate swaps to hedge its emerging-market bond positions, according to James McAlevey, head of global aggregate and absolute return at the firm. The strategy pairs bullish bets on higher-yielding emerging-market bonds with the hedge positions. McAlevey disclosed the approach in discussing the asset manager's portfolio positioning.

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