Hedge Risks With Overseas Bond Funds

International bonds can offer diversification benefits and attractive yields.

Globe with financial papers
(Image credit: Getty Images/iStockphoto)

Many fixed-income investors have carefully divided their portfolios among government and corporate, short-term and longer-term, and taxable and tax-free bonds. Yet they're still missing the biggest piece of the bond-market pie.

International bonds, which account for more than one-third of investable assets worldwide, can offer diversification benefits and attractive yields. Yet "most investors have almost no international bond exposure," says Dave Nadig, chief investment officer of investment-research firm ETF.com.

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Eleanor Laise
Senior Editor, Kiplinger's Retirement Report
Laise covers retirement issues ranging from income investing and pension plans to long-term care and estate planning. She joined Kiplinger in 2011 from the Wall Street Journal, where as a staff reporter she covered mutual funds, retirement plans and other personal finance topics. Laise was previously a senior writer at SmartMoney magazine. She started her journalism career at Bloomberg Personal Finance magazine and holds a BA in English from Columbia University.