Global Fixed-Income Viewpoints

FROM U.S. RETAIL INVESTORS & FINANCIAL ADVISORS

VIEW SURVEY RESULTS 

Global Fixed-Income Securities Today

With rising interest rates in the U.S., now is an opportune time for investors to consider diversifying into global bonds. Yet, BNY Mellon Investment Management’s inaugural survey reveals that while advisors have a general understanding of the global bond market, retail investors are not as well-informed about international diversification.

New Interest Rate Environment

New Interest Rate Environment

Divergence in global interest rates means potentially better opportunities abroad

High
Prevalence

High Prevalence

60% of bond opportunities are outside the U.S.*

History of
Positive Returns

History of Positive Returns

The Barclays Global Aggregate Index (USD hedged) has had positive returns in 14 of the last 15 calendar years**

 

 

Potential to
Minimize Risk

Potential to Minimize Risk

Investors can de-risk their core fixed-income allocation through global diversification

Risk Comparable to
Domestic Bonds

Risk Comparable to Domestic Bonds

Risk, as measured by standard deviation, historically similar to Barclays US Agg Index***

 

 

 


Investor Knowledge Gap

The survey uncovered several reasons why retail investors and advisors may not be allocating more of their investments to global fixed income, including:


What Does This Mean For Investors?

 

 

With a rising interest rate environment in the U.S. and expanding quantitative easing policies abroad, investors may be able to benefit from diversifying interest rate exposure globally.

 

What Does This Mean For Investors

Methodology: Brunswick Insight surveyed 356 U.S. retail investors who are active in their personal investments and have over $100,000 investable assets, and 201 U.S. financial advisors online from November 24 – December 1, 2015.

*FactSet, based on total market capitalizations across the foreign and U.S. fixed income markets as tracked by the Barclays Indices as of 12/31/15

**Morningstar as of 12/31/15

***Morningstar, performance and standard deviation comparisons for the Fund’s Class I shares to the Barclays U.S. Aggregate Index as of 12/31/2015. The Fund’s annualized performance vs. the Barclays U.S. Aggregate index was 2.49% vs 1.44% for the 3yr period; 4.11% vs. 3.25% for the 5yr period; and 5.84% vs. 4.51% for the 10yr period.

The Fund’s annualized standard deviation vs. the Barclays U.S. Aggregate index was 3.13% vs 2.92% for the 3yr period; 2.93% vs. 2.71% for the 5yr period; and 3.49% vs. 3.22% for the 10yr period. Fund comparison to the Barclays U.S. Aggregate Index is for illustrative purposes only. T