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Bond Index Funds Are Gaining Converts

TedTed
edited November 2014 in Fund Discussions
FYI: More investors are hopping on the index-fund trend, and not just with stocks.
More money is flowing into mutual funds and exchange-traded funds that track bond indexes, lured by low expenses. It's been a relatively slow migration, but investors got a big jolt in September with the sudden departure of famed bond guru Bill Gross from PIMCO.
Investors yanked $17.9 billion out of PIMCO's flagship bond fund that month and roughly $800 million from other actively managed bond funds across the industry, according to Morningstar. They poured $2.9 billion into bond index funds. The movement means 21 cents of every $1 in taxable bond funds are invested in an index fund. For U.S. stock funds, it's 37 cents.
Before jumping into a bond index fund, though, keep in mind that they come in many flavors and have their own strengths and weaknesses:
Regards,
Ted
http://bigstory.ap.org/article/8b9dff1055fa47709ccbafeb7aec08ae/bond-index-funds-are-gaining-converts

Comments

  • Sven
    Same here but several years earlier.
  • jerry
    Barrons has an interesting article on ETFs in which one of the panel suggests IUSB , a relatively new(June) ETF from i shares fund with much more than the standard bonds in the Barclay index (this includes high yield and emerging market denominated in dollars.ER is .15, duration about 5 years yield a bit high than the standard bond index
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