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Global Bonds
Old 06-25-2011, 09:20 AM   #1
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Global Bonds

Would anyone consider going international with high-grade foreign debt as is suggested on this seeking alpha thread:

Looking for Retirement Income? Go Global - Seeking Alpha

It seems reasonable to me, but I was wondering if anyone sees any pitfalls.
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Old 06-25-2011, 04:41 PM   #2
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Yes, it is called currency risk. Now that can be hedged to some extent but that adds cost. Is the diversity worth the risk and cost? Probably not. TANSTAAFL.

Caveat - I would consider it if I lived, or planned to live, outside the US.

DD
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Old 06-25-2011, 06:58 PM   #3
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Yes, it is called currency risk. Now that can be hedged to some extent but that adds cost. Is the diversity worth the risk and cost? Probably not. TANSTAAFL.

Caveat - I would consider it if I lived, or planned to live, outside the US.

DD
Good point. Don't know why I didn't think of that...
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Old 06-25-2011, 09:00 PM   #4
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You might consider Pimco's Total Return fund (PTTRX). Gross's has been looking for "safe spreads" both in the US and outside the US. I'm sure he's removed the currency risk factor to a good extent.
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Old 06-25-2011, 09:09 PM   #5
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I would go with a fund like GIM if it were selling at a discount.
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Old 06-26-2011, 06:10 AM   #6
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I'll be buying UK Gilts when I move to the UK so that I don't have the currency risk of owning US bonds
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Old 06-26-2011, 08:52 AM   #7
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I would go with a fund like GIM if it were selling at a discount.
This is the CEF equivalent of Templeton Global Bond (TGBAX) and a very good way to add international bonds to your portfolio. I would not buy individual international bonds unless you've done a lot of research.
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