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Participant ○○○

BNDW vs BND

Our local currency, the CRC, is tightly linked to the USD.

Our bonds = BND.

I'm wondering if we should use BNDW instead? 

BNDW: SEC Yield = 1.78%. 12 mo yield = 2.88%.

BND: SEC Yield = 1.19%. 12 mo yield = 2.50%.

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4 Replies
Participant ○○○

Re: BNDW vs BND

duration difference?

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Frequent Contributor

Re: BNDW vs BND

Considering that many foreign bonds have much lower yields [i.e. overvalued] than the US, that may not be a good idea.

YBB
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Participant ○○○

Re: BNDW vs BND

@YBB

BNDW has higher yields vs BND. See OP.

It looks like Mr Market wants to PAY US to diversify into non-USD bonds.

Our "BND" consists of 2 ETFs.

BNDW's duration = 7.3 yr. Credit = A.

BND's duration = 6.5 yr. Credit = AA.

Our "BND" consists of 2 ETFs. Our "BNDW" would be only 1 ETF.

A simplification bonus in addition to being paid to eat a free lunch of diversification.

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Participant ○○○

Re: BNDW vs BND

We've decided to go with UNHEDGED WB (AGGG) instead of USD HEDGED WB (AGUG).

We'll do this in early October.

This article supports the unhedged version.

https://www.barrons.com/amp/articles/heres-what-the-dollars-decline-means-for-global-bond-investors-...

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