Bond Mix

Our bond strategy uses multiple bond funds, primarily AGG, BOND, HYS, and PONDX. AGG is an index fund, which means that it is representative of the entire bond market and follows whatever the broad market for bonds does. BOND is a fund actively managed by PIMCO, which is the world’s largest bond management company. Over time its performance has usually been better than the index. PONDX is an unconstrained, high-income bond fund, meaning that it can position itself to take advantage of wherever the opportunity is in the bond space, and even become defensive in a rising rates environment. We believe this fund strengthens the diversity of our bond portfolio and helps provide some protection against the risk of rising interest rates. In some circumstances we also use funds HYS, MINT and BSV. MINT and BSV are short-term bond funds and we use this as an alternative to cash in some circumstances. HYS is a fund that invests in high yield corporate bonds with 5 years or less to maturity. This fund is also actively managed by PIMCO.

Funds Used:

Pimco Income Fund (PONDX), Pimco Total Return Active (BOND), Aggregate Bond Index (AGG), Pimco High Yield Corporate (HYS), Pimco Short-Maturity Fund (MINT), Vanguard Short-Term Bond (BSV)