Sky Enterprises actively invests in Emerging Market (EM) Treasuries to create safe, sustainable and repeatable returns on its capital with leverage in some cases where the FX risks can be hedged with reasonable safety.
Returns on leveraged Treasury trades creates double digit returns and make up a large part of the Asset side of the balance sheet of Sky Enterprises.
About Treasury Securities:
Treasury securities are direct obligations of sovereign entities, such as the federal government of the United States or the governments of foreign countries. Foreign government treasury securities are generally fixed-income securities of varying maturities and are backed by the full faith and credit of national, state or provincial governments. These securities may also include debt obligations of supranational entities, such as international organizations supported by governmental entities to promote economic reconstruction or development, international banking institutions and related government agencies.
Treasury securities issued by certain foreign governments also offer high safety of principal invested and a reasonable assurance that interest payments will be made. They are often considered the safest forms of investment in those economies, posing the lowest credit risk. Treasuries are often accepted as collateral in various financial transactions by local financial institutions and easily traded and converted to cash. In recent years, foreign investors have been attracted to treasury securities issued by the governments of countries like Nigeria and South Africa, owing to their inclusion in Emerging Market bond indexes formulated by recognized institutions including JP Morgan, the history of performance of these governments in meeting their obligations, and the high returns on the securities.