Moving away from US Treasury bonds: Defensive asset alternatives to government bonds

What options are there for investors?

Van Luu, head of currency at Russell Investments, looks at the alternative instruments investors should consider for portfolio diversification and risk reduction purposes in lieu of government bonds.

Van Luu, head of currency at Russell Investments, looks at the alternative instruments investors should consider for portfolio diversification and risk reduction purposes in lieu of government bonds. US Treasury bonds are not likely to repeat their spectacular performance as the income-producing risk reducers in portfolios of the past four decades. While government bonds still have a role to play as a risk-reducer and deflation hedge, we believe that they will not be as powerful a counterweight to equity risk as in the past. Investors should therefore look at worthwhile alternative...