German Government Bonds Review

German Government Bonds

German government bonds are one of the many types of government bonds available to investors. These bonds can give you international exposure, and be very beneficial in making your portfolio more diverse. Just like United States savings bonds, the bonds issued by the German government are rated AAA prime by the rating agencies, making them an ideal choice for almost any portfolio. The government bond market in Germany is one of the most liquid out of all the European countries, and there are several types of German government bonds to choose from, depending on how long you want to hold the bond until it matures.

The German government offers both long and short term government bonds, meeting almost every investment need. These securities are issued by the German Debt Agency, and are available in short term bills, two year notes, five year notes, and both ten and thirty year bonds. German government bonds are considered secure and very low risk, and offer an opportunity for international investing without many of the high risks involved in other investment choices. The rate given for these bonds are significantly higher than the rates offered with Japanese government bonds and many other international bond investments. In addition the relationship between the USA and Germany is cordial, and both countries have many of the same goals.

One of the biggest benefits with German government bonds to US investors is the higher interest rates offered, and another is the fact that this foreign country has a government and financial accounting systems that are similar to the USA. Swiss government bonds are also highly popular for the same reason, but currently this country has lower interest rates offered, often two percent or even lower. In comparison German government bonds may offer from one percent up to six percent or more, depending on the maturity date of the specific bond. Any investor who wants international exposure could do much worse than these bonds.