Global Bonds

[Whisper9999]

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.

[DblDoc]

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

[Whisper9999]

Quote:

Originally Posted by DblDoc 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...

[Lsbcal]

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.

[MichaelB]

I would go with a fund like GIM if it were selling at a discount.

[nun]

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

[eytonxav]

Quote:

Originally Posted by MichaelB 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.