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Bond Funds and ETFs

For the average investor, picking through the opaque world of individual bond investing can be a daunting task. So why not let the investment pros do the picking for you? Welcome to the world of bond funds -- from money markets, to exchange-traded funds and unit-investment trusts, there's a fund for every need.

Individual Bonds Vs. Bond Funds
Bond funds aren't entirely risk-free. What are the risks of bond funds, and how does this risk compare to that of investing in individual bonds? Learn more to help you make the decision of whether to invest in individual bonds or bond funds.

Choosing among mutual funds, ETFs, and direct investment
Individual investors who are looking for the best way to invest in bonds have three major options to consider: mutual funds, exchange-traded funds (ETFs), and direct investment. Which type of bond investment is right for you?

How to Choose a Bond Mutual Fund
Learn the key steps to evaluating bond funds, and narrowing down the list of choices to determine which bond fund is right for you.

The Risk Spectrum of Bond Funds
The bond fund risk spectrum: Learn about which types of bonds funds have low, moderate, and high risk, and which type of fund may be right for you.

How Many Bond Funds Should You Own?
Do you own too many bond funds? For most investors, it’s easy to achieve your objectives with anywhere from one to three bond funds. Find out how to avoid confusing quantity with diversification.

Should You Buy the Best Performing Bond Funds?
Investors often use past performance as their main criterion for choosing a bond fund, but there's much more to picking a fund than simply looking at its historical returns.

How Bond Fund Performance Can Be Misleading
Investors often focus on the best performing bond funds, but putting too much empahsis on past performance can be short-sighted.

Why Invest in the Lowest Fee Mutual Funds?
Numerous studies have shown that mutual funds and ETFs with the lowest expense ratios deliver the best long-term performance. Find out why low expense ratios are so important to fund returns, and how you can benefit from owning low-fee funds.

The Pros and Cons of Investing in No-Load Bond Funds
Find out the difference between the load and expense ratio, and why most investors are better off choosing no-load funds.

Invest in a Bond Mutual Fund
Bonds are among the safest investments available. And as a general rule, mutual funds are the safest way to invest in bonds. But that doesn't mean you should jump right in. Here are a few items to consider before you buy a bond fund.

Distribution Yield vs. SEC Yield: Which Should You Use?
An easy-to-understand explanation of the difference between a distribution yield and an SEC yield. Which yield calculation should you use, and why does it matter?

Bond Funds Ranked 4- and 5-Stars by Morningstar
Get the list of all bond mutual funds ranked 4-Star and 5-Star by Morningstar.

Should You Buy 5-Star Morningstar Funds?
Morningstar star ratings can help you choose mutual funds, but they have three important limitations. Why even a 5-star fund may not be right for you.

Should You Reinvest the Income from Your Bond Funds?
Putting the power of compounding to work: the key to long-term wealth accumulation lies in the reinvestment of dividends and capital gains.

When to Sell a Bond Fund
When to sell a bond fund: For all of the time spent providing investors with advice on how to buy bond funds, much less attention is given to the issue of when is the most appropriate to time to sell a bond fund. With that in mind, here are five signs that it's time to sell your bond fund and move on.

Active vs. Passive Management in Bond Funds
There are two types of bond funds: actively managed funds and passively managed funds. Learn the key differences between active and passive management, and which type has delivered better long-term performance results.

How to Choose an Actively Managed Bond Fund
There's more to choosing an actively managed bond fund than past performance - investors also need to know HOW a fund is generating its returns.

Actively Managed Bond Funds: Short-Term Underperformance, Longer-Term Strength

When it Comes to Bond Funds, "High Quality" Doesn't Mean "Safe"
Bond funds that invest in higher-quality bonds aren't necessarily safer. Find out why funds that invest in higher-rated bonds may not be right for you.

Choosing Among Short-Term, Intermediate-Term, and Long-Term Bond Funds
One of the most important aspects of investing in bond funds and ETFs is understanding the differences in the risks and return characteristics of bonds with different maturities. Learn about the risk and reward characteristics of short-term, intermediate-term, and long-term bond funds, and determine which option is best ruited fro you.

Why You Shouldn't Buy Mutual Funds Before They Pay Dividends
Find out why using a taxable account to buy a mutual fund before it makes a distribution can actually cost you money.

The Returns of Short, Intermediate, and Long Term Bonds
Longer-term bonds typically offer higher yields than short-term bonds, but the difference in total returns is driven by the direction of interest rates. What can investors expect from long-term bond funds if rates begin to rise?

The Basics of Money Market Funds
Money market funds are considered to be one of the lowest-risk options in the mutual fund world, but they also offer the lowest expected returns. Find out everything you need to know about investing in money market funds.

The Risks of Money Market Funds
Most investors view money market funds as being a “risk-free” investment on par with a bank account or certificate of deposit. In fact, money market funds have more risk than you may think – a key consideration for anyone who has their short-term cash or emergency fund invested in money funds.

Short Term Bonds Funds vs. Money Market Funds
Investors who need to keep their money safe can choose between short-term bond funds or money market funds. Short-term bond funds tend to have higher yields than money market funds, but they can also have a greater degree of risk. Find out if a short-term bond fund or a money market fund is the right choice for your investment objectives.

Do Stable Value Funds Belong in Your 401(k)?
Stable value funds, an investment option in retirement plan programs (such as 401(k)s and certain other tax-deferred vehicles, offer guaranteed return of principal with higher returns than are typically available in money market funds. Learn more about the benefits and risks of stable value funds, and whether they are a good option for your...

Should You Own an Ultrashort Bond Fund?
Ultrashort bond funds have grown in popularity as investors try to escape the low yields on money market funds. But are ultrashort-term bond funds as safe as fund companies say?

Short Term Bond Funds: The Pros and Cons
Short-term bond funds for beginners: learn the basics, yields and historical returns, risks and ways to invest via mutual funds and ETFs.

The Benefits and Risks of Long Term Bond Funds
Long-term bond funds can deliver outstanding returns when interest rates are falling. But beware: long-term bond funds also carry outsized risk. Learn more about the benefits and risks of investing in long-term bond funds.

The Benefits and Risks of Bond Index Funds
Bond index funds are the simplest and most cost-effective way to invest in bonds. Learn about the benefits and risks of index funds, and whether they may be the best option for you.

What is a Core Bond Fund?
Core funds are so named since the idea is that if investors owned only one investment grade bond fund in their portfolio, the core fund could essentially cover all the bases. But do core bond funds truly help investors maximize thier diversification?

Is Now the Time to Buy an Unconstrained Bond Fund?
Find out what unconstrained bond funds are and how they can play a role in your portfolio.

The Pros and Cons of Target Retirement Funds
Target Retirement Funds have become a popular option for retirement investors in recent years. Are target date funds right for you?

How Duration Affects the Performance of Your Bond Funds
What is duration, and how does duration affect the performance of your bond fund?

How to Use Duration to Predict a Bond Fund's Return
How to use duration to gauge the likely returns of bond funds in ETFs in various interest rate scenarios But beware, this approach has limitations.

How Does a Strong Dollar Affect International Bond Funds?
A strong U.S. dollar can hurt the performance of global and international mutual funds, while a weak U.S. dollar can help. Learn how movements in the dollar can help or hurt the value of your overseas investments.

How are Bond Funds Taxed?
Find out how the taxes on mutual funds' dividend income and capital gains differ, and why you have to pay a final capital gains tax when you sell a fund, even though you have been paying a capital gains tax each year.

Bond ETFs: The Complete, Updated List
The complete, updated list of bond exchange-traded funds (ETFs), sorted by category.

How to Reduce Taxes on Mutual Funds: 10 Ways to Lower Your Tax Bill
Find out how to lower your taxes: here are the top ten ways you can reduce the taxes on your mutual funds and keep a greater share of your hard-earned money.

Overweight and Underweight in Investing - Definition and Explanation
What does your fund's manager mean when he or she says the fund is "overweight" or "underweight" a particular investment? Learn the definition here.

Bond ETFs vs. Bond Mutual Funds: Historical Returns and Costs
What's the best way to invest in bonds, mutual funds or ETFs? Learn the cost and return difference between bond mutual funds and bond ETFs.

2013 Bond ETF Returns, Plus The Best and Worst Bond ETFs of 2013
The comprehensive guide to 2013 bond ETF performance, including the returns of the top ten, bottom ten, and ten largest bond ETFs.

Why Bond ETF Share Prices Can Differ from Their Net Asset Values (NAVs)
Find out why the share prices of bond ETFs can trade below the funds' actual value, and how you can use this to your advantage.

The Lowest Fee Bond ETFs
See the list of the 20 lowest fee bond ETFs, along with an explanation of the important role fees play in bond funds' performance.

The Complete and Updated List of Short-Term Bond ETFs
Investors who are worried about the bond market, or who are in need of a low-risk investment, can consider these short-term bond ETFs.

Municipal Bond ETFs: Which Muni ETFs are Right for You?
Get the complete, updated list of municipal bond ETFs, sorted by category, along with an overview of each type of ETF. Learn more about the different kinds of municipal bond ETFs, including index funds such as iShares S&P National Municipal Bond Index Fund (MUB), as well as muni ETFs focused on the high-yield, AMT-free, California, and New York...

Global, International, and Emerging Market Bond ETFs: The Complete, Updated List
The list of exchange-traded funds (ETFs) that invest in international bonds has expanded during the past year. Get the complete, updated list of international, global, and emerging market bond ETFs.

Target Maturity Bond Funds: An Alternative to Laddering
Target maturity bond funds can help investors bridge the gap between the diversification of bond funds and the greater certainty of bond ladders. Find out if target maturity bond funds are right for you.

What Are Leveraged Bond ETFs?
Leveraged bond ETFs are are investment vehicles that allow experienced investors to achieve daily returns two or three times that of a particular asset class. Find out how leveraged bond funds work, and whether these products are right for you.

Inverse Bond Funds: The Risks and Benefits
Inverse bond funds can be an effective short-term vehicle for sophisticated investors to bet against the bond market. However, inverse bond funds also come with substantial risks.

Actively Managed Bond ETFs: The Complete, Updated List
There are currently just 22 actively managed ETFs, but the category is expanding following 2012’s introduction of the PIMCO Total Return ETF. See the list of all actively managed bond ETF, together with their tickers and expense ratios.

Should You Buy Vanguard Total Bond Market Index Funds: BND and VBMFX?
The Vanguard Total Bond Market Index Funds - BND and VBMFX - aren't "total" at all. In fact, they only cover a fraction of the global bond market.

Should you Invest in Hedged High Yield Bond ETFs?
Hedged high yield bonds ETFs sound good on paper, but there are many reasons why a hedged approach is an inefficient way to invest in high yield bonds.

List of Vanguard Bond Funds and ETFs
Vanguard is one of the world's pre-eminent providers of bond mutual funds and bond ETFs. Get the list of all Vanguard bond funds and ETFs, along with tickers, expense ratios, and Morningstar rankings.

Are Closed-End Bond Funds a Better Option than Mutual Funds or ETFs?
Learn the basics of closed-end bond funds, how to invest, and how to determine whether closed-end bond funds are the right option for your situation.

Vanguard Total World Stock (VT): The Only Stock ETF You Need
Vanguard Total World Stock ETF (VT) takes an all-in-one approach that helps investors gain full global stock market exposure within a single fund.

Should I Invest in Unit Investment Trusts: Are UITs Right for You?
A "unit investment trust" is made up of a collection of bonds, just like a bond mutual fund. But a UIT holds the investments in the trust until maturity. Fees are low compared with mutual funds. But you'll likely pay a brokerage fee to buy a UIT of up to 3%.

Bond ETF Returns: The Best and Worst Bond ETFs of 2012
Find out how every bond ETF performed in 2012, sorted by category, plus the top 10 bond ETFs, the bottom 10 bond etfs, and the returns of the ten largest bond ETFs.

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