Investors are passing up opportunities in the globalfixed-income market because they don’t really understand how thoseinvestments work.

That’s according to a new survey from BNY Mellon InvestmentManagement, which found that 70 percent of retail investors hold noglobal fixed-income investments, and 62 percent don’t see globalfixed income as important. As a result, they’re missing out onglobal diversification in that segment oftheir portfolios.

Advisors, on the other hand, are more savvy when it comes toincorporating global fixed income into a portfolio, with 63 percentsaying it’s important that a client’s portfolio contain some globalfixed-income securities.

In contrast, just 38 percent of retail investors think it’simportant that they hold some global fixed-income investments.

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And even if advisors are recommending it—56 percent respondedthat they do so—clients aren’t listening, with just 30 percentreporting that they have such investments as part of theirportfolios.

There are several reasons that both retail investors andadvisors may not be making the most of global fixed-incomeinvestments. One reason is a lack of understanding on the part ofretail investors of how they work; 40 percent of respondents saidthey didn’t know that as interest rates increase, bond pricesgenerally go down.

In addition, only 12 percent of retail investors say they wouldincrease the global diversification of their fixed-incomeallocation after a rate hike, despite the fact that more than athird (35 percent) of advisors would recommend a more globallydiversified fixed-income allocation.

Another is lack of knowledge about how prevalent global bondsare. Seventy-nine percent of retail investors are either unsure ofthe percentage of bonds issued outside the U.S., or say that thepercentage is less than 50 percent.

The actual percentage of non-U.S. opportunities is 60 percent.Even the majority of advisors—59 percent—are either unsure of thepercentage of bonds issued outside the U.S., or say that the numberis less than 50 percent.