RESILIENCE
As of 12/31/20. Sources: Capital Group, Morningstar. Vertical axis shows indexed total return. The core bond benchmark is the Bloomberg U.S. Aggregate Index. Capital Group’s True Core approach seeks to provide all four roles of fixed income, emphasizing whichever roles are most important in a given market environment. This approach also maintains a high-quality portfolio that utilizes multiple levers to seek consistent excess returns.
APPROACH
We have identified which funds contribute to a particular role of fixed income based on the fund's investment strategies. The extent to which a fund contributes to a specified role depends on the portfolio's composition at any point in time. Investment-grade bonds are rated BBB and higher.
As of 3/31/22. Sources: Capital Group, Morningstar. “Volatility” dates shown are representative of the five largest equity market declines (without dividends reinvested) in the unmanaged S&P 500 with at least 50% recovery persisting for more than one business day between declines. The returns are based on total returns. There have been periods when the fund has lagged the equity index, such as in rising equity markets.
A focus on capital preservation has led to positive returns over rolling 3-year periods since inception:
Short-Term Bond Fund of America
Intermediate Bond Fund of America
A risk-adjusted return focus has led to outpacing the core bond benchmark over rolling 3-year periods since 2009:
The Bond Fund of America
American Funds Strategic Bond Fund
As of March 31, 2023. Sources: Capital Group, Morningstar. “Time-tested” rolling returns based on monthly data. On January 1, 2009, The Bond Fund of America’s strategy was repositioned from core plus to core fixed income, with its prospectus and guidelines adjusted accordingly. Inception dates for Short-Term Bond Fund of America and Intermediate Bond Fund of America were October 2, 2006 and February 19, 1998, respectively. “Core bond benchmark” refers to the Bloomberg U.S. Aggregate Index. Based on results of F-2 shares. Data shown for American Funds Strategic Bond Fund since its March 18, 2016 inception.
FEATURED FUNDS
Received a Morningstar Analyst RatingTM of Gold and Silver for F-2 and A share classes, respectively, as of 11/16/22.1
Correlations closer to zero may offer good diversification from equities.
As of 3/31/23
The number of funds in 10-, 5-, 3-, and 1- year groups were 282, 378, 414 and 461, respectively. Fund (class F-2) percentile ranking based on average annualized total returns (Morningstar Intermediate Core Bond category).
This chart shows average annualized excess returns for The Bond Fund of America and passive peers compared to their respective benchmarks.
Correlations closer to zero may offer good diversification from equities.
As of 3/31/23
The number of funds in 10-, 5-, 3-, and 1- year groups were 282, 378, 414 and 461, respectively. Fund (class F-2) percentile ranking based on average annualized total returns (Morningstar Intermediate Core Bond category).
The Bond Fund of America outpaced passive, after fees.
This chart shows average annualized excess returns for The Bond Fund of America and passive peers compared to their respective benchmarks.
As of 3/31/23. Sources: Capital Group, Morningstar. Duration indicates a bond fund’s sensitivity to interest rates. Higher duration indicates more sensitivity. Passive funds are not striving to outpace their benchmarks; rather, they seek to replicate the benchmark's return pattern. When contemplating passive versus active fixed income funds, it's also important to consider, among other things, each fund's investment objectives and policies, risks, tax implications from portfolio turnover and expenses. Excess returns shown over strategies' respective prospectus benchmark for passive peer groups net of fees from the Morningstar Intermediate Core Bond category. The rankings do not reflect the effects of sales charges, account fees or taxes. Past results are no guarantee of results in future periods.
High-quality core bond funds can help provide balance. The Bond Fund of America and Strategic Bond Fund have outpaced peers without adding risk. The right mix depends on your goals. Financial professionals, see what mix of SBF and BFA may work for your clients.
Learn about Morningstar's approach to core and core-plus.
Data reflects annualized 5-year return and standard deviation. As of 3/31/23. F-2 share class shown for our funds. Source: Morningstar. Morningstar bond category averages shown.
Correlations closer to zero may offer good diversification from equities.
As of 3/31/23
The number of funds in 5-, 3-, and 1- year groups were 508, 554 and 613, respectively. Fund (class F-2) percentile ranking based on average annualized total returns (Morningstar Intermediate Core-Plus Bond category)
SBF's rates-driven approach takes active duration positioning
This chart shows Strategic Bond Fund and category duration relative to the Bloomberg Barclays U.S. Aggregate Index.
Correlations closer to zero may offer good diversification from equities.
As of 3/31/23
The number of funds in 5-, 3-, and 1- year groups were 508, 554 and 613, respectively. Fund (class F-2) percentile ranking based on average annualized total returns (Morningstar Intermediate Core-Plus Bond category)
This chart shows Strategic Bond Fund and category duration relative to the Bloomberg U.S. Aggregate Index.
As of 3/31/23. Sources: Capital Group, Bloomberg Index Services Ltd., Morningstar. Duration indicates a bond fund’s sensitivity to interest rates. Higher duration indicates more sensitivity. "Net high-yield exposure" reflects impact of credit default swap protection, used to hedge systematic market risk and focus exposure on the idiosyncratic risk of high-conviction credits. The rankings do not reflect the effects of sales charges, account fees or taxes. Past results are no guarantee of results in future periods.
Macro and investment perspectives on fixed income from Capital Group.
We believe diverse perspectives produce better results.
Ideas to help you meet client needs.
Figures shown are past results and are not predictive of results in future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. Investing for short periods makes losses more likely. View fund expense ratios and returns. View current SEC yields.
The Morningstar Analyst Rating (i) should not be used as the sole basis in evaluating a fund, (ii) involves unknown risks and uncertainties which may cause the Manager Research Group’s expectations not to occur or to differ significantly from what they expected, and (iii) should not be considered an offer or solicitation to buy or sell the fund.
“Volatility” dates shown are representative of the five largest equity market declines (without dividends reinvested) in the unmanaged S&P 500 Index with at least 50% recovery persisting for more than one business day between declines. The returns are based on total returns. There have been periods when the fund has lagged the equity index, such as in rising equity markets. “Time-tested” rolling returns based on monthly data for the period January 1, 2009, through December 31, 2022. On January 1, 2009, The Bond Fund of America’s strategy was repositioned from core plus to core fixed income, with its prospectus and guidelines adjusted accordingly. Inception dates for Short-Term Bond Fund of America and Intermediate Bond Fund of America were October 2, 2006 and February 19, 1998, respectively. Based on results of F-2 shares. Data shown for American Funds Strategic Bond Fund since its March 18, 2016 inception.
The Bond Fund of America is the largest actively managed bond fund in the Morningstar U.S. Intermediate Core Bond category, as of 3/31/2023.
Returns shown at net asset value (NAV) have all distributions reinvested.
Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses and summary prospectuses, which can be obtained from a financial professional and should be read carefully before investing.
There may have been periods when the fund(s) lagged the index(es). Certain market indexes are unmanaged and, therefore, have no expenses. Investors cannot invest directly in an index.
All Capital Group trademarks referenced are registered trademarks owned by The Capital Group Companies, Inc. or an affiliated company. All other company and product names mentioned are the trademarks or registered trademarks of their respective companies.
Funds are managed, so holdings will change. Certain fixed income and/or cash and equivalents holdings may be held through mutual funds managed by the investment adviser or its affiliates that are not offered to the public.
Investment results assume all distributions are reinvested and reflect applicable fees and expenses.
When applicable, results reflect fee waivers and/or expense reimbursements, without which they would have been lower. Read details about how waivers and/or reimbursements affect the results for each fund. View results and yields without fee waiver and/or expense reimbursement.
The use of derivatives involves a variety of risks, which may be different from, or greater than, the risks associated with investing in traditional cash securities, such as stocks and bonds.
American Funds Strategic Bond Fund may engage in frequent and active trading of its portfolio securities, which may involve correspondingly greater transaction costs, adversely affecting the fund's results.
Higher yielding, higher risk bonds can fluctuate in price more than investment-grade bonds, so investors should maintain a long-term perspective.
Statements attributed to an individual represent the opinions of that individual as of the date published and do not necessarily reflect the opinions of Capital Group or its affiliates. This information is intended to highlight issues and should not be considered advice, an endorsement or a recommendation.
This content, developed by Capital Group, home of American Funds, should not be used as a primary basis for investment decisions and is not intended to serve as impartial investment or fiduciary advice.
Investing outside the United States involves risks, such as currency fluctuations, periods of illiquidity and price volatility, as more fully described in the prospectus. These risks may be heightened in connection with investments in developing countries.
The return of principal for bond funds and for funds with significant underlying bond holdings is not guaranteed. Fund shares are subject to the same interest rate, inflation and credit risks associated with the underlying bond holdings.
Lower rated bonds are subject to greater fluctuations in value and risk of loss of income and principal than higher rated bonds.
Class F-2 shares were first offered on August 1, 2008. Class F-2 share results prior to the date of first sale are hypothetical based on Class A share results without a sales charge, adjusted for typical estimated expenses.
S&P 500 Index is a market capitalization-weighted index based on the results of approximately 500 widely held common stocks.
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The Core category contains portfolios that invest primarily in investment-grade U.S. fixed-income issues and hold less than 5% in below-investment-grade exposures. The Core-Plus category contains portfolios that invest primarily in investment-grade U.S. fixed-income issues but have greater flexibility than core offerings to hold non-core sectors such as corporate high yield, bank loan, emerging-markets debt, and non-U.S. currency exposures.
Bond ratings, which typically range from AAA/Aaa (highest) to D (lowest), are assigned by credit rating agencies such as Standard & Poor's, Moody's and/or Fitch, as an indication of an issuer's creditworthiness. For most funds, unless otherwise noted below, if agency ratings differ, a security will be considered to have received the highest of those ratings, consistent with applicable investment policies. Securities in the Unrated category have not been rated by a rating agency; however, the investment adviser performs its own credit analysis and assigns comparable ratings that are used for compliance with applicable investment policies. Bond ratings, which typically range from AAA/Aaa (highest) to D (lowest), are assigned by credit rating agencies such as Standard & Poor's, Moody's and/or Fitch, as an indication of an issuer's creditworthiness.
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