It is hard for active bond management to compete with bond index funds and ETFs.
Unlike the Fed, which has engaged in a wide-ranging Quantitative Easing exercise aimed at reducing longer-term interest rates, the ECB has only ever engaged in bond purchases in the most grudging way possible and currently has no active bond purchase program.
We see an increasing amount of people owning active leveraged bond funds.
FORBES: Fed Announces New Treasury Buying Plan; Investors Uninspired
The only consistent data point we have observed over the five-year horizon is that a majority of active equity and bond managers in most categories lag comparable benchmark indices.
Speculation about its next steps has led to more active trading in the bond, though the price has hardly changed.
Indeed, the overwhelming evidence indicates that they are just as inept as other active managers when trading their bond portfolios.
With the initial run of the Pimco Total Return ETF ( BOND), active ETFs and their managers may need to start thinking about the challenges that success could pose to the ETF structure.
The corporate-bond market has become less active partly because of the government's massive extension of credit to troubled borrowers.
If volatility increases and all areas of the bond market start to decline, active fixed-income investors can go to cash.
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If bond prices across the board were hit, active investors could even opt to go to cash.
FORBES: 5 Reasons Why Bond Funds Can Help You Navigate Bond Market Headwinds Successfully
Obama, meanwhile, took a "major, major step toward cementing the bond between the Latino community and the Democratic Party in an active way" by stopping the deportations, according to Schiller.
With all of the colorful personalities, active wagering and pervasive waft of manure in the air, the action lately in the municipal bond market seems a lot like a day at the races.
FORBES: Loose Lips, Lots Of Hype Make Municipal Bonds Look Juicy
Today, there are well over 1, 000 index funds and ETFs that track nearly every stock, bond, and commodity market worldwide, and they do it at very low cost compared to active management.
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