The Risks and Rewards Of International Bonds [And How To Invest]

The global bond market is far larger and more liquid than the global stock market. Over the last 25 years, the bond market has, on average, been 79% larger than the stock market, according to learnbonds.com.

Bonds provide stability against the volatile nature of stocks. In a 60/40 portfolio, 60% is allocated in stocks while the other 40% goes to bonds. As an investor approaches retirement, their allocation to bonds increases, mainly, so there is capital for them to withdraw during retirement.

Foreign bonds can make up part of the bond allocation within a portfolio. Let’s see why someone might consider the risks and rewards of foreign bond funds as part of their investment.