TY - BOOK ID - 133457792 TI - Do Multi-Sector Bond Funds Pose Risks to Emerging Markets? AU - Cortes, Fabio. AU - Sanfilippo, Luca. PY - 2020 PB - Washington, D.C. : International Monetary Fund, DB - UniCat KW - Finance: General KW - Investments: Bonds KW - Money and Monetary Policy KW - Industries: Financial Services KW - Current Account Adjustment KW - Short-term Capital Movements KW - Portfolio Choice KW - Investment Decisions KW - International Financial Markets KW - Pension Funds KW - Non-bank Financial Institutions KW - Financial Instruments KW - Institutional Investors KW - General Financial Markets: General (includes Measurement and Data) KW - Monetary Systems KW - Standards KW - Regimes KW - Government and the Monetary System KW - Payment Systems KW - Finance KW - Investment & securities KW - Monetary economics KW - Mutual funds KW - Bonds KW - Currencies KW - Emerging and frontier financial markets KW - Securities markets KW - Financial institutions KW - Money KW - Financial markets KW - Financial services industry KW - Capital market KW - United States UR - https://www.unicat.be/uniCat?func=search&query=sysid:133457792 AB - Emerging economies in the post-crisis period increasingly saw portfolio debt inflows from a type of large international investment fund: Multi-Sector Bond Funds (MSBFs). These investors have lacked adequate representation in the literature. This paper constructs a new detailed database from micro-level MSBF emerging market (EM) holdings from 2009:Q4–2018:Q2. Exploiting this data, the paper assesses the risks they pose to the financial stability of specific emerging bond markets. The data shows that MSBFs are highly concentrated–both in their positions and their decision-making. The empirical results further suggest that MSBFs exhibit opportunistic behavior (and more so than other investment funds). In periods of high risk aversion, large MSBF portfolio reallocations out of EMs can be associated with underperformance of the same markets, signaling the importance of monitoring their footprint and better understanding their asset allocation decisions. ER -