In their latest update, Vanguard's experts, Kunal Mehta, Roger Roger Hallam and Christopher W. Alwine provide their latest sector-by-sector analysis of global fixed income markets and a summary of how these trends affect Vanguard's active bond funds.
Key highlights include:
- Bond markets sold off in the third quarter, as the market began to embrace the ‘higher-for-longer' narrative around interest rates.
- In rates markets, much of the activity has been further out on the yield curve, where yields rose significantly, and continued to rise at the start of October.
- Looking ahead, we believe high-quality, investment-grade corporates look the most attractive credit option and are best equipped to weather an economic slowdown.
Our active bond funds managed in-house
Fixed income at Vanguard
A longer-term perspective. Find out more about fixed income at Vanguard
Investment risk information
The value of investments, and the income from them, may fall or rise and investors may get back less than they invested.
Past performance is not a reliable indicator of future results.
Any projections should be regarded as hypothetical in nature and do not reflect or guarantee future results.
Some funds invest in emerging markets which can be more volatile than more established markets. As a result the value of your investment may rise or fall.
Funds investing in fixed interest securities carry the risk of default on repayment and erosion of the capital value of your investment and the level of income may fluctuate. Movements in interest rates are likely to affect the capital value of fixed interest securities. Corporate bonds may provide higher yields but as such may carry greater credit risk increasing the risk of default on repayment and erosion of the capital value of your investment. The level of income may fluctuate and movements in interest rates are likely to affect the capital value of bonds.
Reference in this document to specific securities should not be construed as a recommendation to buy or sell these securities, but is included for the purposes of illustration only.
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