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Giroux: Time to Put Bonds Back on the Radar

The fact that everybody is so nervous about bonds today actually makes us a little more positive, says 2012 Morningstar Allocation Fund Manager of the Year David Giroux.


Greg Carlson: Let's turn to the fund's bond portfolio. There have been some significant changes there. Leveraged loans have been the biggest piece of that pie, perhaps, in some ways, and that weighting has come down a bit. Meanwhile, you've bought some shorter-term, more traditional bonds.

David Giroux: I think one of the things we've had in the fixed-income portfolio is a real bet that rates were going to rise someday. We didn't know that they were going to happen this year, but we've had a big pretty bet on the portfolio. That manifests itself in a very short duration. Our duration of our fixed-income portfolio is about 1.7 years. Over half of the portfolio in our fixed income was floating rate.

Greg Carlson does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.