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Nominees for Fixed-Income Manager of the Year

Kicking off our 2011 Manager of the Year Awards.

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It's already December, and it is once again time to announce Morningstar's nominees for Managers of the Year. We'll kick off the process with nominations for fixed-income managers and then discuss our choices for domestic-stock funds on Tuesday and international-stock funds on Thursday. Those who have followed the process before know that we're not simply looking for the manager with the highest returns in a calendar year, though a strong showing is certainly one criterion. More broadly, we seek to honor those managers who have gone above and beyond the call of duty to do what's right for shareholders and have delivered superior long-term returns with a sound strategy.

This year's nominees for fixed income are an unusual group. While our past nominees and winners have frequently featured core intermediate-term bond offerings such as Bill Gross'  PIMCO Total Return (PTTRX), neither Gross nor many of his direct competitors found 2011's bond markets hospitable. Very few foresaw the Treasury bond market rally that dominated the year's performance charts. Many strongly underweighted the sector given its paltry payouts and concern that a spike in yields could trigger considerable pain. Even among those active managers who were more sanguine about the Treasury market environment, few, if any, even maintained a fully neutral allocation to the sector, which comprised more than 34% of the Barclays Capital U.S. Aggregate Bond Index at the end of November.

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Eric Jacobson has a position in the following securities mentioned above: PTTRX. Find out about Morningstar’s editorial policies.