Emerging market bonds have been among the strongest-performing fixed-income asset classes in 2026, outperforming many developed-market government bonds and investment-grade corporate debt.
Over the last 12 months, the Morningstar Emerging Markets Sovereign Bond Index gained 4.8% through July 30 in euro terms. That compares with a 1.3% gain in the Morningstar Global Core Bond Index, while the Morningstar Global Treasury Index is essentially flat over the same period.
EM central banks have in the main been cutting interest rates, which lowers bond yields and pushes up prices. Economic growth has been strong despite the impact of the Iran war, while real interest rates in emerging countries—policy rates minus inflation—remain high in many developing economies.
“Financial fundamentals have improved significantly since the global financial crisis, with lower external debt, stronger current account balances, and more credible monetary policy from central banks. Attractive valuations, therefore, further strengthen the case for maintaining an overweight position,” Pictet Asset Management wrote in a recent report.
What Are EM Bond Funds?
Global emerging market bond funds hold US-dollar-denominated bonds issued by emerging-market countries. Most of these funds primarily hold government or sovereign bonds, but emerging market corporate bonds are often found in their portfolios.
To help investors find strategies focused on this segment, we’ve screened 174 open-end funds and exchange-traded funds in Morningstar’s Global Emerging Markets Bond category for those with Gold Medalist Ratings.
A Gold Medalist Rating means our analysts believe a fund has the greatest chance of outperforming its category over the long term.
There are 21 strategies earning a Gold Medalist Rating. We list here the 10 largest in terms of assets under management.
- Pimco GIS Emerging Markets Bond Fund Institutional USD Accumulation
- Morgan Stanley Emerging Markets Debt Opportunities Fund J
- Neuberger Berman Emerging Market Debt Hard Currency Fund USD
- iShares Emerging Markets Government Bond Index Fund
- Capital Group Emerging Markets Debt Fund
- Vanguard USD Emerging Markets Government Bond UCITS ETF VDET
- BNP Paribas Easy JPM Screened EMBI Global Diversified Composite Track I Cap
- State Street Emerging Markets Hard Currency Government Bond Index Fund
- Vontobel Sustainable Emerging Markets Debt E USD
- Barings Emerging Markets Sovereign Debt Fund Tranche A USD ACC
Three of the 10 strategies listed above are passively managed. Among them there is an exchange-traded fund.
Here’s a closer look at the four funds with more than EUR 3 billion in assets. Be sure to review a fund’s complete report for more details.
Pimco GIS Emerging Markets Bond Fund
- Fund Size: EUR 5.9 billion
- Morningstar Category: Global Emerging Markets Bond
- Morningstar Medalist Rating: Gold
- Morningstar Rating: ★★★★★
The actively managed Pimco GIS PLC—Emerging Markets Bond Fund gained 9.59% over the past year, outperforming the average fund in the global emerging markets bond category, which rose 8.21%. The fund beat 72% of its peers and beat its category benchmark, the Morningstar Emerging Markets Sovereign Bond Index, by 4.38 percentage points. The fund has gained 4.39% year to date, while the average fund in its category is up 3.94%.
Morgan Stanley Emerging Markets Debt Opportunities Fund
- Fund Size: EUR 3.5 billion
- Morningstar Category: Global Emerging Markets Bond
- Morningstar Medalist Rating: Gold
- Morningstar Rating: ★★★★★
The Morgan Stanley Emerging Markets Debt Opportunities Fund rose 16.59% over the past year. The gain on the actively managed fund beat the 8.21% gain on the average fund in the global emerging markets bond category, outperforming 96% of its peers. The fund beat its benchmark by 11.38 percentage points. Year to date, the Morgan Stanley fund rose 10.89%.
Neuberger Berman Emerging Market Debt Hard Currency Fund
- Fund Size: EUR 3.3 billion
- Morningstar Category: Global Emerging Markets Bond
- Morningstar Medalist Rating: Gold
- Morningstar Rating: ★★★★
Over the past year, the actively managed Neuberger Berman Emerging Market Debt—Hard Currency Fund rose 10.74%, while the average global emerging markets bond fund gained 8.21%. The fund outperformed 86% of its peers and beat its category benchmark, the Morningstar Emerging Markets Sovereign Bond Index, by 5.53 percentage points. The strategy has climbed 4.87% year to date, outperforming the average fund in its category, which rose 3.94%.
iShares Emerging Markets Government Bond Index Fund (IE)
- Fund Size: EUR 3.1 billion
- Morningstar Category: Global Emerging Markets Bond
- Morningstar Medalist Rating: Gold
- Morningstar Rating: ★★★
The iShares Emerging Markets Government Bond Index Fund rose 9.54% over the past year. The gain on the passively managed fund beat the 8.21% gain on the average fund in the global emerging markets bond category, underperforming 58% of its peers. The fund beat its category benchmark by 4.33 percentage points. Year to date, the BlackRock fund rose 4.81%.
