How To Get A Better Return From International Bonds
|
|
- Ferdinand James
- 3 years ago
- Views:
Transcription
1 International fixed income: The investment case
2 Why international fixed income? International bonds currently make up the largest segment of the securities market Ever-increasing globalization and access to information has led to increased investor acceptance regarding international investing Concern regarding the future of the U.S. economy and financial markets Additional diversification benefits Global capital markets 33% International bonds 24% International equities 22% U.S. bonds 21% U.S. equities Sources: MSCI, Barclays Capital, and Vanguard, as of December 31, U.S. equities are represented by the MSCI US Broad Market Index. International equities are represented by the MSCI AC World Ex USA IMI. U.S. bonds are represented by the Barclays Capital US Aggregate Bond Index. International bonds are represented by the Barclays Capital Global Aggregate ex-usd Index. 2
3 Key drivers of returns imply global diversification benefits Correlations of yields and inflation in the largest international markets versus the United States, Belgium Canada France Germany Italy Japan Netherlands Spain U.K. Correlation of changes in foreign inflation rates to U.S. inflation rates Correlation of changes in foreign long bond yields to U.S. bond yields Sources: U.S. Federal Reserve, U.S. Bureau of Labor Statistics, various international government agencies via Thomson Reuters Datastream, and Vanguard. 3
4 Yet adding unhedged foreign bonds has increased portfolio volatility Annual volatility of a portfolio starting at 100% U.S. bonds 12% 10% Annual volatility 8% 6% 4% 2% 0% 0% 20% 40% 60% 80% 100% Percentage of portfolio in international bonds Past performance is no guarantee of future returns. The performance of an index is not an exact representation of any particular investment, as you cannot invest directly in an index. All benchmarks in this and subsequent slides do not have real-world operating, trading, or hedging costs. The use of index funds or ETFs in any investment strategy will have differing results because of differences in management costs, tracking error, and other factors. Sources: MSCI, Barclays Capital, Citigroup, and Vanguard.Data from 1985 to December 31, U.S. equities are represented by Dow Jones U.S. Total Stock Market Index from 1975 through April 22, 2005, and the MSCI US Broad Market Index thereafter. International equities represented by MSCI World Ex USA Index through 1987, MSCI AC World Ex USA Index from 1/1/1988 to 4/30/1994, and MSCI AC World Ex USA IMI thereafter. U.S bonds represented by Barclays Capital US Aggregate Bond Index. International bonds represented by Citigroup World Government Bond Ex-US Index through 1989 and Barclays Capital Global Aggregate ex-usd Bond Index thereafter. 4
5 And not improved downside risk Worst 12 months for portfolio starting at 100% U.S. bonds 0% -2% -month return % -6% -8% -10% -12% 0% 20% 40% 60% 80% 100% Percentage of portfolio in international bonds Sources: MSCI, Barclays Capital, Citigroup, and Vanguard. Data from 1985 to December 31, U.S. equities are represented by Dow Jones U.S. Total Stock Market Index from 1975 through April 22, 2005, and the MSCI US Broad Market Index thereafter. International stocks represented by MSCI World Ex USA Index through 1987, MSCI AC World Ex USA Index from 1/1/1988 to 4/30/1994, and MSCI AC World Ex USA IMI thereafter. U.S bonds represented by Barclays Capital US Aggregate Bond Index. International bonds represented by Citigroup World Government Bond Ex-US Index through 1989 and Barclays Capital Global Aggregate ex-usd Bond Index thereafter. 5
6 Unhedged foreign bonds did not help during the global flight to quality Total return: March 2008 February % 2% 0% -2% -4% -6% -8% -10% -12% U.S. bonds International bonds Currency exposure Sources: Barclays Capital, Citigroup, and Vanguard. U.S bonds represented by Barclays Capital US Aggregate Bond Index. International bonds represented by Citigroup World Government Bond Index Ex US through 1989 and Barclays Capital Global Aggregate ex-usd Index thereafter. 6
7 Volatility significantly dampened by hedging currency exposure 70% 60% 12-month rolling return 50% 40% 30% 20% 10% 0% -10% -20% Hedged international bonds Unhedged international bonds Sources: Thomson Reuters Datastream, Barclays Capital, Citigroup, and Vanguard, as of December 31, Hedged international bonds are represented by the Citigroup World Government Bond Ex-US Hedged Index through 1989 and the Barclays Capital Global Aggregate ex-usd Hedged Index thereafter. Unhedged international bonds are represented by the Citigroup World Government Bond Ex-US Index through 1989 and the Barclays Capital Global Aggregate ex-usd Index thereafter. U.S. bonds are represented by the Barclays Capital U.S. Aggregate Bond Index. Past performance is no guarantee of future returns. The performance of an index is not an exact representation of any particular investment, as you cannot invest directly in an index. 7
8 Diversification benefits show up with hedged foreign bonds Annual volatility of a portfolio starting at 100% U.S. bonds 5% 4% 57 bps volatility reduction Annual volatility 3% 2% 1% 0% 0% 20% 40% 60% 80% 100% Percentage of portfolio in hedged international bonds Sources: MSCI, Barclays Capital, Citigroup, and Vanguard. Data from 1985 to December 31, U.S. equities are represented by Dow Jones U.S. Total Stock Market Index from 1975 through April 22, 2005, and the MSCI US Broad Market Index thereafter. International stocks represented by MSCI World Ex USA Index through 1987, MSCI AC World Ex USA Index from 1/1/1988 to 4/30/1994, and MSCI AC World Ex USA IMI thereafter. U.S bonds represented by Barclays Capital US Aggregate Bond Index. International bonds represented by Citigroup World Government Bond Ex-US Hedged Index through 1989 and Barclays Capital Global Aggregate ex-usd Hedged Bond Index thereafter. 8
9 And downside risk improved Worst 12 months for portfolio startingat 100% U.S. bonds 0% -1% 12-month return -2% -3% -4% -5% 0% 20% 40% 60% 80% 100% Percentage of portfolio in hedged international bonds Sources: MSCI, Barclays Capital, Citigroup, and Vanguard. Data from 1985 to December 31, U.S. equities are represented by Dow Jones U.S. Total Stock Market Index from 1975 through April 22, 2005, and the MSCI US Broad Market Index thereafter. International stocks represented by MSCI World Ex USA Index through 1987, MSCI AC World Ex USA Index from 1/1/1988 to 4/30/1994, and MSCI AC World Ex USA IMI thereafter. U.S bonds represented by Barclays Capital US Aggregate Bond Index. International bonds represented by Citigroup World Government Bond Ex-US Hedged Index through 1989 and Barclays Capital Global Aggregate ex-usd Hedged Bond Index thereafter. 9
10 Why hedge bonds and not stocks? Annualized return and volatility, International stocks return International stocks volatility International bonds returns International bonds volatility Local contribution Currency contribution Sources: Thomson Reuters Datastream, Barclays Capital, Citigroup, Dow Jones, MSCI, and Vanguard. Notes: International stocks are represented by the MSCI World ex-us Index from 1985 to1989 and the MSCI All Country World ex-us Index thereafter. International bonds are represented by the Citigroup World Government Bond ex-us index from 1985 to 1989 and the Barclay s Capital Global Aggregate ex-usd Index thereafter. 10
11 But what about long-term returns? Total return: January 1985 December % 9.40% 8% 7.88% 7.17% 6% 4% 2% 0% U.S. bonds International bonds currency exposure International bonds no currency exposure Sources: Barclays Capital, Citigroup, and Vanguard. Data from 1985 to December 31, U.S bonds represented by Barclays Capital US Aggregate Bond Index. International bonds represented by Citigroup World Government Bond Index Ex US through 1989 and Barclays Capital Global Aggregate ex-usd Index thereafter. 11
12 Why now? Currency hedging costs have declined nearly 50% since the early 2000s Bid-ask spread on 1-month currency forward 0.40% 0.30% 0.20% 0.10% 0.00% Australian dollar Canadian dollar Euro Yen Swiss franc British pound Weighted average hedging cost Sources: Thomson Reuters Datastream, Barclays Capital, and Vanguard, as of December 31, We used the annualized bid-ask spread on a 1-month currency forward contract as a proxy for the cost of implementing a constant rolling hedge for each individual currency. In practice, 3- or 6-month forward may be used. The weighted average hedging cost is approximated by combining the currency forwards according to the historical market weight of the outstanding debt of each entity. 12
13 Summary and key takeaways Single largest asset class International bonds are expected to provide diversification benefits Hedged foreign bonds lower portfolio volatility and downside risk, providing exposure to global bonds without adding currency risk Falling costs of hedging international bonds makes a global bond allocation more attractive 13
14 Important information All investing is subject to risk, including the possible loss of the money you invest. Bond funds are subject to the risk that an issuer will fail to make payments on time, and that bond prices will decline because of rising interest rates or negative perceptions of an issuer's ability to make payments. Investments in stocks or bonds issued by non-u.s. companies are subject to risks including country/regional risk and currency risk. Bonds of companies based in emerging markets are subject to national and regional political and economic risks and to the risk of currency fluctuations. These risks are especially high in emerging markets. Diversification does not ensure a profit or protect against a loss The Vanguard Group, Inc. All rights reserved. 14
Diversify portfolios with U.S. and international bonds
Diversify portfolios with U.S. and international bonds Investing broadly across asset classes such as stocks, bonds and cash can help reduce volatility and risk within a portfolio. Canadian investors have
More informationStaying alive: Bond strategies for a normalising world
Staying alive: Bond strategies for a normalising world Dr Peter Westaway Chief Economist, Europe Vanguard Asset Management November 2013 This document is directed at investment professionals and should
More informationVanguard research July 2014
The Understanding buck stops here: the hedge return : Vanguard The impact money of currency market hedging funds in foreign bonds Vanguard research July 214 Charles Thomas, CFA; Paul M. Bosse, CFA Hedging
More informationThree new stock ETFs for greater global diversification
Three new stock ETFs for greater global diversification Canadian stocks account for less than 4% of publicly traded companies global market value. Investors in Canada, however, allocate 59% of their stock
More informationVanguard research July 2014
The Understanding buck stops here: the hedge return : Vanguard The impact money of currency market hedging funds in foreign bonds Vanguard research July 214 Charles Thomas, CFA; Paul M. Bosse, CFA Hedging
More informationPROTECTING YOUR PORTFOLIO WITH BONDS
Your Global Investment Authority PROTECTING YOUR PORTFOLIO WITH BONDS Bond strategies for an evolving market Market uncertainty has left many investors wondering how to protect their portfolios during
More informationGlobal fixed income: Considerations for U.S. investors
Global fixed income: Considerations for U.S. investors Vanguard research February 214 Bonds issued in currencies other than the U.S. dollar constitute more than half of the taxable bond market, yet U.S.
More informationRegistered country information Vanguard Investment Series plc and Vanguard Funds plc
Registered country information Vanguard Investment Series plc and Vanguard Funds plc The value of investments, and the income from them, may fall or rise and investors may get back less than they invested.
More informationManaging Risk/Reward in Fixed Income
INSIGHTS Managing Risk/Reward in Fixed Income Using Global Currency-Hedged Indices as Benchmarks In the pursuit of alpha, is it better to use a global hedged or unhedged index as a benchmark for measuring
More informationWhy own bonds when yields are low?
Why own bonds when yields are low? Vanguard research November 213 Executive summary. Given the backdrop of low yields in government bond markets across much of the developed world, many investors may be
More informationHead Considerations for global equities: A European investor s perspective
Head Considerations for global equities: A European investor s perspective Vanguard Research September December 214 Peter Westaway, PhD, Matthew Tufano, Todd Schlanger, CFA, Christopher Philips, CFA When
More informationGlobal Currency Hedging
Global Currency Hedging John Y. Campbell Harvard University Arrowstreet Capital, L.P. May 16, 2010 Global Currency Hedging Joint work with Karine Serfaty-de Medeiros of OC&C Strategy Consultants and Luis
More informationGlobal equities: Balancing home bias and diversification
Global equities: Balancing home bias and diversification Vanguard research February 214 Equities not domiciled in the United States accounted for 51% of the global equity market as of December 31, 213,
More informationLearn about active and passive investing. Investor education
Learn about active and passive investing Investor education Active, passive or both: Which is right for you? Portfolios can be built using actively managed and index mutual funds either individually or
More informationHow Hedging Can Substantially Reduce Foreign Stock Currency Risk
Possible losses from changes in currency exchange rates are a risk of investing unhedged in foreign stocks. While a stock may perform well on the London Stock Exchange, if the British pound declines against
More informationTHE FIXED INCOME DILEMMA: Rethinking Fixed Income with a Global Perspective AN NEI REPORT UPDATED AS AT JUNE 30, 2015
THE FIXED INCOME DILEMMA: Rethinking Fixed Income with a Global Perspective AN NEI REPORT UPDATED AS AT JUNE 30, 2015 THE FIXED INCOME DILEMMA: Rethinking Fixed Income with a Global Perspective UPDATE:
More informationHSBC World Selection Funds April 30, 2016. Monthly Factsheets Class A and C Shares. Investment products: ARE NOT A BANK ARE NOT DEPOSIT OR
HSBC World Selection Funds April 30, 2016 Monthly Factsheets Class A and C Shares Aggressive Strategy Fund Balanced Strategy Fund Moderate Strategy Fund Conservative Strategy Fund Income Strategy Fund
More information7 ESSENTIAL TIPS FOR MANAGING CURRENCY RISK
7 ESSENTIAL TIPS FOR MANAGING CURRENCY RISK At a Glance Investing offshore gives you access to a larger and more varied investment universe, with opportunities for growth and income that are simply unavailable
More informationThe active/passive decision in global bond funds
The active/passive decision in global bond funds Vanguard research November 213 Executive summary. This paper extends the evaluation of active versus passive management to global bond funds. Previous Vanguard
More informationGlobal bond investing
Global bond investing Todd Schlanger, CFA Investment Strategy Group Vanguard Asset Management, Limited This document is directed at professional investors and should not be distributed to, or relied upon
More informationReducing bonds? Proceed with caution
Reducing? Proceed with caution Vanguard research April 2013 Executive summary. Historically low yields from U.S. and recent cautions in the media about a potential bond bubble have led many investors to
More informationAnnuity Linked TVI Index. Explained
Annuity Linked TVI Index Explained 1 Key Features of the Annuity Linked TVI Index The Index aims to deliver positive returns while moderating volatility regardless of market direction. The Index goal is
More informationConsiderations for investing in non-u.s. equities
Considerations for investing in non-u.s. equities Vanguard research March 212 Executive summary. Non-U.S. equities currently account for close to 55% of global market capitalization, thus representing
More informationMERCER PORTFOLIO SERVICE MONTHLY REPORT
MERCER PORTFOLIO SERVICE MONTHLY REPORT MAY 206 Mercer Superannuation (Australia) Limited ABN 79 004 77 533 Australian Financial Services Licence # 235906 is the trustee of the Mercer Portfolio Service
More informationHow To Know What To Expect From A Portfolio Of Stocks
23 June 2015 Macro Diversi,ication: Investing in an Increasingly Turbulent and Integrated World Brian D. Singer, CFA Partner, Head of Dynamic Allocation Strategies Team FOR INSTITUTIONAL USE ONLY 240418
More informationVanguard UK Short-Term Investment Grade Bond Index Fund
Vanguard UK Short-Term Investment Grade Bond Index Fund May 2013 LAUNCH BRIEFING Fund summary The Vanguard UK Short-Term Investment Grade Bond Index Fund expands the low-cost asset allocation building
More informationThe active/passive decision in global bond funds
The active/passive decision in global bond funds Vanguard research November 213 Executive summary. This paper extends the evaluation of active versus passive management to global bond funds. Previous Vanguard
More informationRisk of loss: Should investors shift from bonds because of the prospect of rising rates?
Risk of loss: Should investors shift from bonds because of the prospect of rising rates? Vanguard research July 2010 Executive summary. Many investors, whether individual or institutional, hold a diversified
More informationCreate your plan Vanguard recommends saving 12% 15%. 7% is the average saving rate at Vanguard. Retirement income calculator How much income will you need in retirement? Are you on track? Compare
More informationTraditionally, venturing outside the United States has required two investments: + The equities, frequently the primary interest.
DDWM/DDLS A NEW CHAPTER: DYNAMIC CURRENCY-HEDGED EQUITIES Approximately 50% of the world s equity opportunity set is outside of the United States, 1 and the majority of that is in developed international
More informationSources of return for hedged global bond funds
Research commentary Sources of return for hedged global bond funds August 2012 Author Roger McIntosh Executive summary. The recent results in key bond market indices demonstrate the importance of a strategic,
More informationLifePath Index 2060 Fund Q
Release Date: 9-3-215 LifePath Index 26 Fund Q Standard & Poor's 5 Index LifePath Index 26 Custom Target Date 251+... Allocation of Stocks and Bonds 1 8 6 4 2 45 4 35 3 25 2 15 1 5 Years Until Retirement
More informationGlobal Investing: The Importance of Currency Returns and Currency Hedging
Global Investing: The Importance of Currency Returns and Currency Hedging There is a continuing trend for investors to reduce their home bias in equity allocation and increase the allocation to international
More informationWhen rates rise, do stocks fall?
PRACTICE NOTE When rates rise, do stocks fall? The performance of equities and other return-seeking assets in rising and falling interest rate scenarios, January 1970 through September 2013 William Madden,
More informationDeutsche Alternative Asset Allocation VIP
Alternative Deutsche Alternative Asset Allocation VIP All-in-one exposure to alternative asset classes : a key piece in asset allocation Building a portfolio of stocks, bonds and cash has long been recognized
More informationBMO Corporate Bond ETFs
For professional investors only Exchange Traded Funds PAGE 1 BMO Corporate Bond ETFs Diversified, global bond exposure ember 20 Contact us Client Services +44 (0) 20 70 4444 client.service@bmogam.com bmogam.com/etfs
More informationRules-Based Investing
Rules-Based Investing Disciplined Approaches to Providing Income and Capital Appreciation Potential Focused Dividend Strategy International Dividend Strategic Value Portfolio (A: FDSAX) Strategy Fund (A:
More informationCHICAGO STOCK EXCHANGE, INC. MARKET REGULATION DEPARTMENT INFORMATION CIRCULAR. RE: ishares CURRENCY HEDGED MSCI ETFS TO BEGIN TRADING ON CHX
July 2, 2015 ETF-015-073 CHICAGO STOCK EXCHANGE, INC. MARKET REGULATION DEPARTMENT INFORMATION CIRCULAR RE: ishares CURRENCY HEDGED MSCI ETFS TO BEGIN TRADING ON CHX Pursuant to Information Circular MR
More informationInvestment risk Balancing investment risk and potential reward
Investment risk Balancing investment risk and potential reward This guide has been produced for educational purposes only and should not be regarded as a substitute for investment advice. Vanguard Asset
More informationPrinciples for investment success. We believe you will give yourself the best chance of investment success if you focus on what you can control
Principles for investment success We believe you will give yourself the best chance of investment success if you focus on what you can control Important information This guide has been produced for educational
More informationWorth the risk? The appeal and challenges of high-yield bonds
Worth the risk? The appeal and challenges of high-yield bonds Vanguard research December 212 Executive summary. High-yield bonds 1 have unique characteristics when compared with traditional fixed income
More informationPowerShares Smart Beta Income Portfolio 2016-1 PowerShares Smart Beta Growth & Income Portfolio 2016-1 PowerShares Smart Beta Growth Portfolio 2016-1
PowerShares Smart Beta Income Portfolio 2016-1 PowerShares Smart Beta Growth & Income Portfolio 2016-1 PowerShares Smart Beta Growth Portfolio 2016-1 The unit investment trusts named above (the Portfolios
More informationCalPERS 457 Plan Target Retirement Date Funds
CalPERS 457 Plan Target Retirement Date s September 30, 2015 Overview Target Retirement Date s (the "" or "s") are a series of diversified funds, each of which has a predetermined underlying asset mix
More informationReal Estate as a Strategic Asset Class. Less is More: Private Equity Investments` Benefits. How to Invest in Real Estate?
Real Estate as a Strategic Asset Class The Benefits of Illiquid Investments Real estate, a key asset class in a portfolio, can offer stable income returns, partial protection against inflation, and good
More informationishares MINIMUM VOLATILITY SUITE SEEKING TO WEATHER THE MARKET S UP AND DOWNS
ishares MINIMUM VOLATILITY SUITE SEEKING TO WEATHER THE MARKET S UP AND DOWNS Table of Contents 1 Introducing the ishares Minimum Volatility Suite... 02 2 Why Consider the ishares Minimum Volatility Suite?...
More informationMarket Linked Certificates of Deposit
Market Linked Certificates of Deposit This material was prepared by Wells Fargo Securities, LLC, a registered brokerdealer and separate non-bank affiliate of Wells Fargo & Company. This material is not
More informationFixed Income 2015 Update. Kathy Jones, Senior Vice President Chief Fixed Income Strategist, Schwab Center for Financial Research
Fixed Income 2015 Update Kathy Jones, Senior Vice President Chief Fixed Income Strategist, Schwab Center for Financial Research 1 Fed: Slow and Low 2015 Fixed Income Outlook 2 Yield Curve Flattening 3
More informationExchange Traded Funds Tactical Asset Allocation Tools
Exchange Traded Funds Tactical Asset Allocation Tools Eleanor De Freitas, Catherine Barker 1 Barclays Global Investors Exchange traded funds (ETFs), combine the advantages of both index funds and stocks.
More informationFixed Income ETFs 301 International Fixed Income ETFs. Presenter: RONIT WALNY SVP and Global Product Manager with PIMCO
Fixed Income ETFs 301 International Fixed Income ETFs Presenter: RONIT WALNY SVP and Global Product Manager with PIMCO Inside Fixed Income Conference November 2015 Pacific Investment Management Company
More informationForeign Exchange Market INTERNATIONAL FINANCE. Function and Structure of FX Market. Market Characteristics. Market Attributes. Trading in Markets
Foreign Exchange Market INTERNATIONAL FINANCE Chapter 5 Encompasses: Conversion of purchasing power across currencies Bank deposits of foreign currency Credit denominated in foreign currency Foreign trade
More informationFund commentary. John Hancock Retirement Living Portfolios Q1 2016
John Hancock Retirement Living Portfolios Fund commentary Seek: Long-term growth of capital or a balance between a high level of current income and growth of capital Use for: Broadly diversified, risk-targeted
More informationInformation on Retirement Savings Plans Available at Carnegie Mellon University
Information on Retirement Savings Plans Available at Carnegie Mellon University Carnegie Mellon University offers two retirement savings plans based on eligibility and citizenship/residency: Carnegie Mellon
More informationGMO White Paper. The Case for Not Currency Hedging Foreign Equity Investments: A U.S. Investor s Perspective EXECUTIVE SUMMARY.
GMO White Paper The Case for Not Currency Hedging Foreign Equity Investments: A U.S. Investor s Perspective Catherine LeGraw Apr 2015 EXECUTIVE SUMMARY Investors often ask about GMO s approach to currency
More informationFIXED INCOME INVESTORS HAVE OPTIONS TO INCREASE RETURNS, LOWER RISK
1 FIXED INCOME INVESTORS HAVE OPTIONS TO INCREASE RETURNS, LOWER RISK By Michael McMurray, CFA Senior Consultant As all investors are aware, fixed income yields and overall returns generally have been
More informationTraditionally, venturing outside the United States has involved two investments:
WisdomTree ETFs INTERNATIONAL HEDGED EQUITY FUND HDWM Approximately 50% of the world s equity opportunity set is outside of the United States, 1 and the majority of that is in developed international stocks,
More informationSeek Opportunity in Lower Starting Valuations While Avoiding Crowded Trades
Seek Opportunity in Lower Starting Valuations While Avoiding Crowded Trades Developed Market (DM) Valuations Remain Attractive Developed Market (ex US) valuations remain attractive relative to history
More informationInvestment Strategies for Pension Funds. Christopher Nichols Investment Director, Multi Asset Investing Standard Life Investments (UK)
Investment Strategies for Pension Funds Christopher Nichols Investment Director, Multi Asset Investing Standard Life Investments (UK) Pensions need consistency but markets deliver chaos Discrete Yearly
More informationVanguard LifeStrategy Funds
Vanguard LifeStrategy Funds All-in-one portfolios built from Vanguard s exceptional value index funds This document is directed at professional investors and should not be distributed to, or relied upon
More informationQuarterly Market Review. Fourth Quarter 2015
Q4 Quarterly Market Review Fourth Quarter 2015 Quarterly Market Review Fourth Quarter 2015 This report features world capital market performance and a timeline of events for the past quarter. It begins
More informationPOPULAR BOND INDEXES MAY CONTAIN SIGNIFICANT EXPOSURE TO NON-U.S. ISSUERS. Non-U.S. Exposure in the Most Popular Corporate Bond Indexes
WisdomTree ETFs STRATEGIC CORPORATE BOND FUND CRDT In the current market environment, investors have increasingly targeted corporate bonds 1 as one approach to enhance income in their portfolios. Through
More informationSeeking a More Efficient Fixed Income Portfolio with Asia Bonds
Seeking a More Efficient Fixed Income Portfolio with Asia s Seeking a More Efficient Fixed Income Portfolio with Asia s Drawing upon different drivers for performance, Asia fixed income may improve risk-return
More informationUnderstanding Currency
Understanding Currency Overlay July 2010 PREPARED BY Gregory J. Leonberger, FSA Director of Research Abstract As portfolios have expanded to include international investments, investors must be aware of
More informationAssignment 10 (Chapter 11)
Assignment 10 (Chapter 11) 1. Which of the following tends to cause the U.S. dollar to appreciate in value? a) An increase in U.S. prices above foreign prices b) Rapid economic growth in foreign countries
More informationConsiderations for a Global Approach to Property Investing
CONTRIBUTORS Emily Ulrich Analyst emily.ulrich@spdji.com Michael Orzano, CFA Director Global Equity Indices michael.orzano@spdji.com Philip Murphy, CFA Vice President North American Equities philip.murphy@spdji.com
More informationCurrencies & Currency Hedging
Ugo Egbunike, Moderator Director of Business Development ETF.com Currencies & Currency Hedging Juliana Bambaci, Panelist Index Applied Research MSCI Jonathan Citrin, Panelist Founder & CEO Citrin Group
More informationLearn how your financial advisor adds value. Investor education
Learn how your financial advisor adds value Investor education The value of partnership Many people find it difficult to invest on their own, particularly as they amass wealth and their financial situations
More informationStrength in Diversity: The Case for Investing in Global Fixed Income
Investment Focus Strength in Diversity: The Case for Investing in Fixed Income A well-managed allocation to global fixed income can play an important role in an investor s portfolio. The world economy,
More informationFUNDS TM. G10 Currencies: White Paper. A Monetary Policy Analysis FUNDS. The Authority on Currencies
FUNDS White Paper The Authority on Currencies Merk Investments LLC Research MAY 2012 G10 Currencies: A Monetary Policy Analysis Merk Monetary Score favors currencies of, and Canada; disfavors currencies
More informationCAPITAL MARKETS REVIEW Q4 2011
CAPITAL MARKETS REVIEW Q4 2011 Reviewing the quarter ended September 30, 2011 J. Matthew Hager // David S. Dennerll, CFP // Benjamin R. Stacy 255 East Fifth St. Suite 2210 // Cincinnati, OH 45202 513-287-6778
More informationThe Case for International Fixed Income
The Case for International Fixed Income June 215 Introduction Investing in fixed-income securities outside of the United States is often perceived as a riskier strategy than deploying those assets domestically,
More informationVanguard Emerging Markets Stock Index Fund
Vanguard Emerging Markets Stock Index Fund Supplement to the Prospectus and Summary Prospectus Dated February 26, 2015 New Target Index Effective as of the start of business on November 2, 2015, Vanguard
More informationGlobal fixed income: Considerations for U.S. investors
Global fixed income: Considerations for U.S. investors Vanguard research March 212 Executive summary. Traditionally, U.S. investors have achieved diversification of a domestically focused portfolio primarily
More informationDe-Risking Solutions: Low and Managed Volatility
De-Risking Solutions: Low and Managed Volatility NCPERS May 17, 2016 Richard Yasenchak, CFA Senior Vice President, Client Portfolio Manager, INTECH FOR INSTITUTIONAL INVESTOR USE C-0416-1610 12-30-16 AGENDA
More informationVanguard s framework for constructing diversified portfolios
Vanguard s framework for constructing diversified portfolios Vanguard research April 213 Executive summary. Most investment portfolios are designed to meet a specific future financial need either a single
More informationBMO Global Asset Management (Asia) Limited 11 February 2016
Product Key Facts BMO MSCI EUROPE QUALITY HEDGED TO USD ETF BMO Global Asset Management (Asia) Limited 11 February 2016 Quick facts This is an exchange traded fund. This statement provides you with key
More informationManaging Volatility in Chaotic Markets. Live Webinar July 29, 2010 2:00 3:00 pm EDT
Managing Volatility in Chaotic Markets Live Webinar July 29, 2010 2:00 3:00 pm EDT Welcome What is Volatility Volatility in Context Dave Nadig Director of Research IndexUniverse Managing And Capturing
More informationDynamic correlations: The implications for portfolio construction
Dynamic correlations: The implications for portfolio construction Vanguard research April 212 Executive summary. It s common to hear of the value of diversification during uncertain or volatile markets.
More informationIntroductory remarks by Jean-Pierre Danthine
abcdefg News conference Berne, 15 December 2011 Introductory remarks by Jean-Pierre Danthine I would like to address three main issues today. These are the acute market volatility experienced this summer,
More informationThe Master Statement of Investment Policies and Objectives of The Lower Colorado River Authority Retirement Plan and Trust. Amended June 16, 2015
The Master Statement of Investment Policies and Objectives of The Lower Colorado River Authority Retirement Plan and Trust Amended June 16, 2015 Introduction The Lower Colorado River Authority ( LCRA )
More informationWHY INTERNATIONAL: The Case for International Investing
WHY INTERNATIONAL: The Case for International Investing WHY INTERNATIONAL: THE CASE FOR INTERNATIONAL INVESTING GLOBAL MARKET SHARE... 2 REDUCED PORTFOLIO VOLATILITY... 3 MULTINATIONAL CORPORATION... 4
More informationJPMorgan Global Bond Fund. Global investing - A less volatile choice NEW. SFC-authorised global bond fund with RMB-hedged share classes*!
AVAILABLE FOR PUBLIC CIRCULATION NEW JPMorgan Global Bond Fund December 2015 Asset Management Company of the Year 2014 Fundamental Strategies, Asia + Important information 1. The Fund invests primarily
More informationThe mighty U.S. dollar Why investors may consider rethinking international allocations
International/ Global Equity The mighty U.S. dollar Why investors may consider rethinking international allocations When left unhedged, currency exposure can have potentially negative effects on both the
More informationWHAT ROLE DO BONDS PLAY IN YOUR PORTFOLIO? Guard Against Interest Rate Risk and Credit Events
RETHINK YOUR BONDS Building Better Bond Portfolios Interest rates may inch up this year, but expect them to be low for some time to come. You can continue to achieve your fixed income goals in this environment
More informationCHAPTER 15 INTERNATIONAL PORTFOLIO INVESTMENT SUGGESTED ANSWERS AND SOLUTIONS TO END-OF-CHAPTER QUESTIONS AND PROBLEMS
CHAPTER 15 INTERNATIONAL PORTFOLIO INVESTMENT SUGGESTED ANSWERS AND SOLUTIONS TO END-OF-CHAPTER QUESTIONS AND PROBLEMS QUESTIONS 1. What factors are responsible for the recent surge in international portfolio
More informationTo Hedge or Not To Hedge: Foreign Currency Exposure in Canada
PRACTICE ESSENTIALS EQUITY 201 Canada To Hedge or Not To Hedge: Foreign Currency Exposure in Canada CONTRIBUTORS Sabrina Salemi Analyst Product Management sabrina.salemi@spdji.com Phil Murphy, CFA Vice
More informationPRODUCT HIGHLIGHTS SHEET
Prepared on: 21 February 2013 This Product Highlights Sheet is an important document. It highlights the key terms and risks of the ILP sub-fund and complements the Product Summary and Fund Summary. It
More informationCHICAGO STOCK EXCHANGE, INC. MARKET REGULATION DEPARTMENT INFORMATION CIRCULAR
June 12, 2014 ETF-014-053 CHICAGO STOCK EXCHANGE, INC. MARKET REGULATION DEPARTMENT INFORMATION CIRCULAR RE: ishares TRUST ETFS TO BEGIN TRADING ON CHX Pursuant to Information Circular MR 08-16, the Chicago
More informationLearn how your financial advisor adds value. Investor education
Learn how your financial advisor adds value Investor education The value of partnership Many people find it difficult to invest on their own, particularly as they amass wealth and their financial situations
More informationHow Gold Improves Alternative Asset
How Gold Improves Alternative Asset Performance Alternative investments began gaining traction during the inflationary times of the late 1970s and early 1980s. Modern Portfolio Theory (MPT), as outlined
More informationQuarterly Asset Class Report Institutional Fixed Income
Quarterly Asset Class Report Institutional Presentation To: Presented By: canterburyconsulting.com September 30, 015 Role in the Canterbury Consulting recommends and communicates asset-class strategy with
More informationCorporate Bonds: Check Out These Curves!
Corporate Bonds: Check Out These Curves! It s widely believed that the U.S. economy is the bus driver and we are all along for the ride when it comes to determining the future of interest rates. The U.S.
More informationA Canadian investor s perspective
The Global buck equities: stops Balancing here: Vanguard home bias and money diversification market funds A Canadian investor s perspective Vanguard research July 2014 David C. Pakula, David J. Walker,
More informationVANGUARD TO CHANGE TARGET BENCHMARKS FOR 22 INDEX FUNDS
PRESS RELEASE For a full list of the impacted funds and more information, contact Vanguard Public Relations at 610-669- 5002. VANGUARD TO CHANGE TARGET BENCHMARKS FOR 22 INDEX FUNDS VALLEY FORGE, PA (October
More informationInvestment insight. Fixed income the what, when, where, why and how TABLE 1: DIFFERENT TYPES OF FIXED INCOME SECURITIES. What is fixed income?
Fixed income investments make up a large proportion of the investment universe and can form a significant part of a diversified portfolio but investors are often much less familiar with how fixed income
More informationCondensed Interim Consolidated Financial Statements of. Canada Pension Plan Investment Board
Condensed Interim Consolidated Financial Statements of Canada Pension Plan Investment Board December 31, 2015 Condensed Interim Consolidated Balance Sheet As at December 31, 2015 (CAD millions) As at December
More informationOverview. carried interest. Copyright 2014 by Cambridge Associates LLC. All rights reserved.
Overview Cambridge Associates LLC Global ex U.S. Developed and Emerging Markets Private Equity and Venture Capital Benchmark Commentary Quarter Ending September 30, 2013 During the third quarter, in U.S.
More informationSCOTT & WHITE RETIREMENT/401(K) PLAN Plan Number 090337 Plan Information as of 05/16/2015
SCOTT & WHITE RETIREMENT/401(K) PLAN Plan Number 090337 Plan Information as of 05/16/2015 This legally required notice includes important information to help you compare the investment options under your
More informationSix Strategies for Volatile Markets When markets get choppy, it pays to have a plan for your investments, and to stick to it.
Six Strategies for Volatile Markets When markets get choppy, it pays to have a plan for your investments, and to stick to it. Fidelity Viewpoints 8/22/15 The markets have become volatile again, prompted
More informationCOMPARISON OF CURRENCY CO-MOVEMENT BEFORE AND AFTER OCTOBER 2008
COMPARISON OF CURRENCY CO-MOVEMENT BEFORE AND AFTER OCTOBER 2008 M. E. Malliaris, Loyola University Chicago, 1 E. Pearson, Chicago, IL, mmallia@luc.edu, 312-915-7064 A.G. Malliaris, Loyola University Chicago,
More informationCIO Flash Revisions to our 2016 global outlook Jan 25, 2016
CIO Flash Revisions to our global outlook Jan 25, +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH +++ CIO FLASH The global macro picture:
More information