I am looking into the constructing of my own sort of "structured product" and have been thinking about the risk profiles of the "risk-free" portion of products like this.
Generally, U.S. treasuries are considered to be the closest thing to a risk-free asset (and may still be), but in the current climate where a potential U.S. default is more at the forefront (this question is not about "if" a default will occur), I want to know:
Is there a benefit to trying to construct a "more" risk-free asset/basket of assets such as currency-hedged ultra short-term (~4 weeks) sovereign debt (or other "risk-free" assets? open to ideas) from a collection of financially-stable governments as opposed to only the U.S.? or is any reduction in credit risk made up for (and potentially more) by an increase in risk due to any of the other moving parts involved? (method of currency-hedging, other introduced systematic risks, implementation risks, etc) and would this be feasible/worth it for a non-institutional investor/trader?
I think that this question deals at least a bit with what I'm addressing, but addresses more of the etf/bond price movement side of things which I think differs from mine due to the difference(?) between bonds and bond etfs with regards to repayment of initial investment as well as the focus(?) on bonds versus "risk-free" assets in general.