What are the disadvantages of international bonds?

Questions › What are the disadvantages of international bonds?
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Priya Vishwas asked 2 years ago
   
3 Answers
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Nikhil Rawat answered 2 years ago
The disadvantages of international bonds include: - Foreign exchange risk: The value of the currency in which the bond is denominated may change over time, making it more expensive to repay principal and interest if you need to convert back into your home currency. - Currency risk: The value of your home currency may also decline, meaning you will have to pay more when you redeem your funds in your home currency than when you bought them originally.  
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Akshaj Singh answered 2 years ago
International bonds have a lot of disadvantages which include the following:
  • Risk of default
  • Tax issues 
  • Difficulty in managing international investments
  • High transaction costs
  • Difficulty in repatriating capital at a particular time
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Deepak Goyal answered 2 years ago
International bonds have many disadvantages. These include the fact that they are more expensive in comparison to domestic bonds, they are not as liquid as domestic bonds and sometimes the country where the bond is issued may be unstable.