How QE2 Could Affect Your Money

In Pictures: 6 Sectors to Watch in 2011

[See Why You Should Invest in Corporate Debt.]

Foreign bonds. Some experts are concerned that the Fed's new round of easing could depress the value of the dollar. To hedge against that possibility, experts suggest allocating a small portion of your fixed-income portfolio to foreign bonds. "International debt is a good hedge against dollar depreciation," Satovsky says. He recommends that investors allocate between 2.5 and 10 percent of their portfolio to international debt. Don Quigley, co-manager of the Artio Total Return Bond, says he favors bonds and currencies from countries like Canada and Australia because the outlook for their economies is better than that for the United States. He says both countries have stronger banking systems, and he believes both will be raising interest rates sooner than the United States.

[See 5 Foreign Bond Funds for Yield-Hungry Investors.]

Reader Comments Read all comments (1)

Add Your Thoughts

Comment Name State Select One AL AK AZ AR CA CO CT DE DC FL GA HI ID IL IN IA KS KY LA ME MD MA MI MN MS MO MT NE NV NH NJ NM NY NC ND OH OK OR PA RI SC SD TN TX UT VT VA WA WV WI WY International Email

Please enter the two words below into the text field underneath the image.

Incorrect please try again

Enter the words above: Enter the numbers you hear:

Your comment will be posted immediately, unless it is spam or contains profanity. For more information, please see our Comments FAQ.