Morningstar Bond Categories1 Performance Year to Date
Chart of the Week for December 14 - December 20, 2007
This year’s equity market volatility, unsettling economic indicators, and persistent credit market strain have caused many investors to reevaluate risk. This apparent risk reevaluation is evident within the fixed income market as year-to-date bond fund returns have favored U.S. government bond funds while sectors with more risk, such as high yield funds, have lagged.
As the chart above indicates, U.S. long-term government and inflation-protected bond funds have led fixed income funds on a total return basis this year. High yield and corporate bonds have lagged as investors sought-after traditional “safe haven“ U.S. government bonds. This flight-to-quality has driven up the price of U.S. government bonds and is evident in the U.S. long-term government category tripling the year-to-date performance of the long-term category (the major difference between the two categories is that the long-term category has a large percentage of its assets in the corporate sector and U.S. government bonds have been traditionally considered less risky than corporate bonds). Interestingly, the flight-to-quality is also one of the factors benefiting the inflation-protected category due to its significant exposure to U.S. government bonds.
This illustration was compiled by information from outside sources. These companies are not affiliated with ICMA-RC. This information is being provided for educational purposes and is not intended to be construed as or relied upon as investment advice. ICMA-RC does not offer specific tax or legal advice. Individuals are advised to consider any new investment strategies carefully prior to implementing. Investment information can change rapidly and the changes can be significant particularly in volatile markets. For this reason “as of”’ dates are provided for specific data where applicable. The information should not be considered current after the dates provided.
Please read both the current applicable prospectus and Making Sound Investment Decisions: A Retirement Investment Guide carefully for a complete summary of all fees, expenses, charges, financial highlights, investment objectives, risks and performance information. Investing in mutual funds and other investment vehicles involves risk, including possible loss of the amount invested. Investors should carefully consider the Fund's investment objectives, risks, charges and expenses before investing or sending money. The prospectus contains this and other information about the investment company. The Vantagepoint Funds are distributed by ICMA-RC Services LLC, a wholly owned broker-dealer subsidiary of ICMA-RC and member FINRA / SIPC . For a current prospectus, contact ICMA-RC Services, LLC.
The performance data quoted represents past performance. Past performance is no guarantee of future results. Investment returns and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data illustrated. For performance data current to the most recent month end, contact ICMA-RC Services, LLC by calling 800-669-7400 or by writing to 777 North Capitol Street, NE, Washington, DC 20002-4240. Para asistencia en Español llame al 800-669-8216. Performance data current to the most recent quarter end is available by visiting www.icmarc.org.