We’re not going to discuss whether or not Unconstrained Bond Funds are good, bad or indifferent…that’s entirely up to the individual buying them and their own goals.
But we must discuss the fact that they are the new hot story for fixed income right now.
I have a story up at the Wall Street Journal this morning about this new trend…
Everybody knows these three things about bond investing right now:
1. Interest rates, when next they move, can only go in one direction
2. Rising rates are a killer for bond mutual funds
3. Staying ultra short on the curve to avoid rate risk means earning nothing
So now, taking these three items into consideration, think about what type of investment vehicle would benefit from inflows as more people come around to this reality…
Read the rest: