Does Your Bond Portfolio Need a Passport?

What do vacations and bond portfolios have in common? Expanding beyond opportunities in your home country may be the ticket to enhanced experiences.

Yield curves for bonds issued in different currencies do not move in lockstep. That means portfolio volatility arising from changes in one market’s interest rates may be mitigated through global diversification. Since September 2000, global bond indices have had markedly lower standard deviations than US indices, whether for the markets in aggregate or separately within the government and credit segments.

EXHIBIT 1 – Global Path to a Smoother Ride

Annualized standard deviation, September 1, 2000–October 31, 2023

DISCLOSURES

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About the Author Douglas Finley, MS, CPWA, CFP, AEP, CDFA

Douglas Finley, MS, CFP, AEP, CDFA founded Finley Wealth Advisors in February of 2006, as a Fiduciary Fee-Only Registered Investment Advisor, with the goal of creating a firm that eliminated the conflicts of interest inherent in the financial planner – advisor/client relationship. The firm specializes in wealth management for the middle-class millionaire.

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