Morgan Stanley Sees Cheap Emerging Market Hedges Amid Virus Risk
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The deadly coronavirus is threatening the recent rally in emerging assets, but there’s cheap options to buy some protection, according to Morgan Stanley.
“We suggest taking advantage of low volatility to hedge a portfolio of EM risk assets,” Morgan Stanley strategists including London-based James Lord wrote in a note Monday. “With volatility at historical lows across many asset classes, a temporary pullback in EM currencies and high-yield credit is possible.”