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Fidelity New Markets Income Stays Focused on Its Roots

This dedicated emerging-markets bond fund takes on some big credit bets, but has less volatility than a local currency fund, says Morningstar's Karin Anderson.

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Karin Anderson: Fidelity New Markets Income is a Silver-rated fund in the emerging-markets bond category. It's managed by John Carlson, who has been running it since the mid-'90s. He has a small crew of managers and analysts helping him, but most of them have been working in this space together for more than a decade. And so they have seen the evolution of the emerging-markets bond space as it's gone from hard currency debt on into local currency and corporate.

Some of the funds in this category will invest in local currency bonds and corporates, but this team has really stayed more focused on its roots, which is the hard currency emerging-markets bond side. So, investing in this type of debt means that they are investing dollar-denominated issues or yen, and that has the advantage of keeping down volatility.

Karin Anderson does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.