Investing: Bonds Away

Foreign debt offers higher yields and, today, less risk than T-bonds

U.S. Treasury-bond investors are an anxious bunch these days. They've had a great run. But most know the value of their bonds and bond funds will slide when interest rates rise again. At the same time, these investors want more than ever the steady income offered by interest-paying securities--yet many would rather not gamble on high-yield junk bonds. What to do?

Think globally. Chasing down a decent yield doesn't necessarily mean running up the risk ladder if you consider investments outside the U.S. New Zealand's 10-year government bond, for instance, yields 6%-plus and looks at least as safe as an equivalent...

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