Tensions between Russia and Ukraine may have spurred many investors to pull funds out of the region, but some are sensing it's time to pounce on Ukraine's bonds.
"Russia is unlikely to intervene in the eastern part of Ukraine," said Regis Chatellier, an analyst at Societe Generale, in a note.
"As geopolitical uncertainties ease in the region, we believe, Ukrainian assets should substantially outperform," he added, upgrading Ukrainian sovereign debt to an overweight.
(Read More: Wall Street wary of potential escalation in Ukraine)
Russia's decision earlier this month to sign a treaty to annex the Ukrainian region of Crimea after a referendum held under Russian military occupation showed overwhelming support for the move, has increased geopolitical tensions globally as well as spurred a fund outflow from the region. The West has responded with a series of sanctions on Russia.
Emerging Europe bond funds have seen around 5.3 percent of their assets head for the exits so far this year, according to data from Deutsche Bank.