No such thing as an implicit guarantee

Events in Dubai have served as a warning to investors that purchasing non-guaranteed bonds by entities linked either to governments or to local oligarchs can be a precarious business.

Dubai property prices have fallen by an estimated 50% in the past 12 months, and the construction of numerous high-profile developments has been put on hold.

So investors were well aware that Nakheel, a subsidiary of state-owned holding company Dubai World, was struggling to fulfil its obligations on three sukuk