News & Commentary

Harbor Funds adds mutual fund focusing on emerging markets debt
May 02, 2011

Chicago, Illinois, May 2, 2011 – Harbor Funds today announced the addition of the Harbor Emerging Markets Debt Fund to its lineup of no-load mutual funds. The new fund, which commences operations today, will be managed by Stone Harbor Investment Partners LP.

The Harbor Emerging Markets Debt Fund seeks to maximize total return by investing primarily in fixed income securities that are tied economically to countries with emerging securities markets.  The Fund may invest in emerging market securities denominated in either U.S. dollars or local currencies, but will generally seek to maintain a target weighting of 50% of the Fund's portfolio exposed to U.S. dollar denominated securities and 50% to local currency denominated securities.  The portfolio managers may tactically increase or decrease the Fund's local currency exposure based upon their view as to the relative attractiveness of individual local currencies relative to the U.S. dollar.   The Fund may invest without limit in higher-risk, below-investment-grade debt securities, commonly referred to as high-yield or junk bonds.  The portfolio managers use a "top-down" approach to identify emerging market countries they believe provide more attractive investment opportunities and then select individual investments from within those countries based upon their view of securities they believe offer the highest potential returns based upon the amount of credit, interest rate, liquidity and other risks present. 

"We are excited to partner with Stone Harbor on our first dedicated emerging markets fund", said David G. Van Hooser, Chairman and Chief Executive Officer of Harbor Capital Advisors.  Stone Harbor has substantial experience investing in emerging markets, making them ideally suited to subadvise this new fund."

Peter J. Wilby, CFA, Chief Investment Officer of Stone Harbor Investment Partners, along with Stone Harbor Portfolio Managers Pablo Cisilino, James E. Craige, CFA, Thomas K. Flanagan, CFA, David A. Oliver, CFA, and Christopher M. Wilder, CFA, will serve as portfolio managers of the Fund.

There is no guarantee that the Fund's investment goal will be achieved. Fixed income securities fluctuate in price and the value of a shareholder's investment in the Fund could go down. Because the Fund invests primarily in securities of emerging markets issuers, there is a greater risk that the Fund's share price will fluctuate more than if it invested only in domestic or developed-market securities. In addition, below-investment-grade securities are considered speculative because they have a high risk of issuer default, are subject to greater price volatility, and may be illiquid. Other risks also apply; these are discussed in the Fund's prospectus.

The Harbor Funds lineup of actively managed no-load mutual funds had combined net assets of approximately $60.3 billion as of March 31, 2011. Each Harbor fund is managed by an institutional investment firm chosen by Harbor Capital Advisors, Inc. because of its experience in a specific asset class.