


Diversifying into foreign bond markets has been a win for US investors this year, based on a review of a set of ETFs through Aug. 27's close. The Vanguard Total Bond Market ETF, a proxy for government and investment‑grade corporates, is essentially flat, posting a fractional 0.2% rise.


Cresset Asset Management LLC decreased its stake in SPDR Bloomberg Short Term International Treasury Bond ETF (NYSEARCA:BWZ) by 30.9% in the third quarter, according to its most recent filing with the Securities and Exchange Commission. The firm owned 208,576 shares of the company's stock after selling 93,470 shares during the quarter. Cresset

DMC Group LLC lifted its stake in SPDR Bloomberg Short Term International Treasury Bond ETF (NYSEARCA:BWZ) by 40.3% in the third quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The firm owned 112,419 shares of the company's stock after acquiring an additional 32,294 shares


BWZ is similar to BWX in that it covers ex-US Treasuries, typically trading in lower yield markets as their battles with inflation have been successful. While a decent USD hedge, to the extent that economic developments in the US may hurt the USD, the higher expense ratios make the more sensitive bet more effective. We think that there is a rate downside in ex-US markets. The BWX is more interesting to speculate on that.

U.S. Treasury yields remain elevated after a spike following President Trump's tariff announcements earlier this year. With long-term Treasury yields still close to multi-year highs, investors are tempted to pivot away from stocks in favor of the bond market at this time.