Know how to diversify your portfolio with US bonds

Indian investors are being encouraged to diversify their portfolios by investing in global assets, particularly global fixed income securities such as US treasuries. The convergence of yields between US treasuries and Indian stocks is making bonds an attractive alternative to riskier assets. The 0-1-year segment of US treasuries is offering yields of 5.43% to 5.59%, compared to Nifty's earnings yield of 4.5%. Additionally, exposure to US debt has become more attractive as the yield gap between US treasuries and Indian government debt has narrowed. Indian investors can access US treasuries through funds such as the Bandhan US Treasury Bond 0-1 year Fund of Fund. However, investing in international markets increases compliance burden and carries platform and execution risks.

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