am wrote:Thought bond portion of the portfolio is for reducing volatility and lowering risk. Does not seem like EM bonds would fit into most boglehead portfolios. Why not just increase allocation to EM stocks?
Well, the draft prospectus
says "Credit risk should be moderate for the Fund because it purchases investment-grade and high-yield bonds." They are dollar-denominated, so no currency risk. So the volatility should
lower than for emerging markets stocks. But as to what the big advantage is supposed to be, I don't know. I suspect
it turns out that emerging markets' interest rates are currently higher than U.S. interest rates, i.e. recency. I haven't bothered to check if that's true. Anyone know?
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.