Asian local currency bonds: time to consider passive management

The Asian local currency government bond market is a rapidly evolving asset class. One compelling reason for considering a standalone investment in Asian local currency is the potential to access the relatively higher yielding government bond markets of Southeast Asia. Additionally, investors may also stand to gain from Asian local currency appreciation over time if economic growth in the region continues to outpace other parts of the world. Finally, an allocation to Asian local currency bonds should bring diversification benefits to the typical multi-asset portfolio.