As economic malaise spreads across the US and Europe, investors are increasingly seeking out safer investment destinations. As developed economies struggle, emerging markets have achieved an unexpected reputation for stability.

US lawmakers managed to strike a deal at the eleventh hour to avert a default on the nation’s debt obligations. But this doesn’t mean it’s smooth sailing for the US economy. As if to drive home that point, Standard & Poor’s recently downgraded the US credit rating for the first time.

The effects of the downgrade rippled through every corner of the bond market as mortgage bonds issued by Fannie Mae and Freddie Mac, bonds issued by the major banks and a number of the municipal issues saw their ratings slashed.

Furthermore, US economic growth has been more sluggish than expected, leading many to worry that the economy may enter a second recession. As a result, the cost of insuring all manner of US debt has jumped significantly this year and bond prices have come under intense selling pressure.

Economic problems abound on the other side of the pond as well. The European Central Bank (ECB) has reportedly begun to purchase sovereign debt issued in the region as rising yields have made it more difficult for banks in those countries to find funding on reasonable terms.

In a reversal of fortune, economic hardship in the developed world has made emerging-market bonds all the more attractive. Many developing nations endured their own financial crises in the 1980s and 1990s. These countries now run tight fiscal and monetary policies, have kept debt levels low and implemented investor-friendly policies. These changes make developed nations look like spendthrifts. Consequently, although bonds issued by developed countries will likely fall further, emerging-market bonds should prove far less volatile.

PowerShares Emerging Markets Sovereign Debt (NYSE: PCY), an exchange-traded fund, has been on the ascendency amid the turmoil in the fixed-income market. Offering exposure to sovereign debt issued by about two-dozen countries, the fund’s average daily trading volume has swelled in recent months as investors hunt for income beyond the developed world. The fund offers attractive diversification from a geographical standpoint; Africa is the only continent that is not represented in the fund’s portfolio.

The fund’s expenses are quite modest at 0.5 percent, and it offers an impressive 5.5 percent yield paid in monthly distributions—an attractive quality for income investors.

That’s not to say this is a risk-free investment. The countries represented in the fund’s portfolio are all expected to outperform the average growth rate for the developed world for the next three years. But there are political risks inherent to investing in any emerging-market bonds. Venezuela and Pakistan—two of the fund’s largest country allocations—are emblematic of the political uncertainty found in the merging world. Nevertheless, for now the political risk posed by emerging markets pales in comparison to the economic hardship faced in the developed world