U.S. Bond

U.S. bond mutual funds and ETFs invest the majority of their assets... U.S. bond mutual funds and ETFs invest the majority of their assets in government and corporate debt of governments and corporations in the United States. These funds can be actively or passively managed and may seek to track or outperform a particular benchmark. If based in another country, they may hedge foreign currency risk, or elect to leave themselves exposed to fluctuations in the U.S. Dollar. Depending on their mandate, a U.S. bond mutual fund or ETF may focus on investment-grade bonds, high-yield (a.k.a. junk bonds), or a mix of credit quality. Governments are the largest issuers, by far, of bonds in the U.S. Of note, the U.S. federal government has outstanding debt as of 2024 of over US$34 trillion. U.S. corporations are also major issuers of bonds. Financial and non-financial corporations combined had debt securities outstanding of over US$23 trillion as of 2022. Investors purchase U.S. bond mutual funds and ETFs to get both capital growth and income. These funds can vary significantly in terms of risk. A fund that exclusively invests in short-term U.S. government debt is likely to be more conservative than a fund that only invests in long-term municipal bonds, for example. Last Updated: 12/27/2024 View more View less

U.S. bond mutual funds and ETFs invest the majority of their assets in government and corporate debt of governments and corporations in the United States. These funds can be actively or passively managed... U.S. bond mutual funds and ETFs invest the majority of their assets in government and corporate debt of governments and corporations in the United States. These funds can be actively or passively managed and may seek to track or outperform a particular benchmark. If based in another country, they may hedge foreign currency risk, or elect to leave themselves exposed to fluctuations in the U.S. Dollar. Depending on their mandate, a U.S. bond mutual fund or ETF may focus on investment-grade bonds, high-yield (a.k.a. junk bonds), or a mix of credit quality. Governments are the largest issuers, by far, of bonds in the U.S. Of note, the U.S. federal government has outstanding debt as of 2024 of over US$34 trillion. U.S. corporations are also major issuers of bonds. Financial and non-financial corporations combined had debt securities outstanding of over US$23 trillion as of 2022. Investors purchase U.S. bond mutual funds and ETFs to get both capital growth and income. These funds can vary significantly in terms of risk. A fund that exclusively invests in short-term U.S. government debt is likely to be more conservative than a fund that only invests in long-term municipal bonds, for example. Last Updated: 12/27/2024 View more View less