[How about] buying treasury bond with HIGH prime rate countries?

[jk90029]

Dear-

Suppose a trader shows roughly ONLY 10% (compounded) return rate over many years. (after tax, unfortunately, due to heavy trading cost)

As below, there are lots of countries with national bond rate with higher than annual 10%.

How about buying treasury bond of 20 countries, for expected 10% yield rate (instead of stock return rate 10%)?
In case one country is broke, then the rest 19 countries may help the loss of 1/20 (5% principle).

Is there any FUND (like too many equity funds)?

https://en.wikipedia.org/wiki/List_of_countries_by_commercial_bank_prime_lending_rate

 

[Robert Morse]

First I would say that saying ONLY 10% (compounded) return rate is interesting, because if I could lock in 6% to 8% in my retirement account over many years with low inflation, this would be a great return with fixed income and low risk. To get 10% right now, I have to take on a fair amount of risk in futures or equities.

If you buy government bond of 20 countries, you will have to calculate your currency risk or hedge it out. This can get expensive. You will also have the principal risk that comes with these higher rates. Whatever you are doing now, that you find unsatisfying at only 10%, sounds better to me.

 

[jk90029]

First I would say that saying ONLY 10% (compounded) return rate is interesting, because if I could lock in 6% to 8% in my retirement account over many years with low inflation, this would be a great return with fixed income and low risk. To get 10% right now, I have to take on a fair amount of risk in futures or equities.

If you buy government bond of 20 countries, you will have to calculate your currency risk or hedge it out. This can get expensive. You will also have the principal risk that comes with these higher rates. Whatever you are doing now, that you find unsatisfying at only 10%, sounds better to me.

Good to hear you.

Over many years, return rate (before expense of tax and commission) was annual 25% roughly.
However after the expense of annual 15% final return rate (in my pocket) was ONLY 10%. (Tax rate is 15/25=60%)

Unless I find another holy grail, my current trading logic may show the same record in the future (as the previous years).
If so, I may buying 20 country's treasury bond, instead of fluctuating trading.
As always, national bond is MUCH more safer than equity.

Is there any FUND for national bond investment?

Of course annual 10% or 12% compounded make 1.12^50 = 289.0022 = 300 times during the 50 years(from 30 to 80)

 

[Robert Morse]

Good to hear you.

Over many years, return rate (before expense of tax and commission) was annual 25% roughly.
However after the expense of annual 15% final return rate (in my pocket) was ONLY 10%.

Unless I find another holy grail, my current trading logic may show the same record in the future (as the previous years).
If so, I may buying 20 country's treasury bond, instead of fluctuating trading.
As always, national bond is MUCH more safer than equity.

Is there any FUND for national bond investment?

Of course annual 10% or 12% compounded make 1.12^50 = 289.0022 = 300 times during the 50 years(from 30 to 80)

Search for "mutual fund for sovereign debt". I found this: http://money.usnews.com/funds/mutual-funds/rankings/emerging-markets-bond
I don't know enough about this to recommend one.

Now that I no longer trade full time, I choose to make allocations to CTAs, but I'm comfortable with the risk. I'm not one to buy a small portfolio or SPY and hold it for long periods of time.

 

[jk90029]

Thanks for helpful start point.

As Buffets shows roughly 12% outperform over the index, for the last 50 years (if I heard correctly), personally the 12% (annual compounded) might be the best return rate IN MY EXPERIENCE.

Although the invest length is less than 10 years, I am confident for the 12%.
Furthermore, I am VERY pleased since the return rate (after expense) is ALWAYS between 10% and 15% for sure, ALWAYS.

 

[Daal]

DBV buys the 3 highest yielding currencies and shorts the 3 lowest ones. But only among the G10

 

[jk90029]

DBV buys the 3 highest yielding currencies and shorts the 3 lowest ones. But only among the G10

Appreciated if you show me some link (or others) for newbie like me.

 

[Daal]

Appreciated if you show me some link (or others) for newbie like me.

https://www.invesco.com/portal/site/us/financial-professional/etfs/product-detail?productId=dbv

 

[jk90029]

https://www.invesco.com/portal/site/us/financial-professional/etfs/product-detail?productId=dbv

Unfortunately, current close of $25 is almost same as 10 years ago(2006), as shown in https://finance.yahoo.com/quote/DBV?ltr=1 .

Is there any yield(like dividend in stock) that a newbie did NOT find?

 

[Maverick74]

You want something like this:

https://www.everbank.com/currencies/cd-baskets

However these are not government bonds but CD rates in the return on foreign currencies. These are "relatively" safe since they are short term.

There is NO such thing as safe bonds. Not even US Treasury bonds. Bonds have inflation risk. Any country offering a high rate of return on bonds is doing so because their money is worth less meaning they may offer 7% on a 10 year govie but their inflation is 5% so you are really only getting 2% in real terms plus the insane volatility that comes from holding them.