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Sidestepping the Pitfalls in Bonds

Top-down strategies can be difficult to execute, but the long-tenured team at Bronze-rated Lord Abbett Total Return have built a strong long-term track record.

Mentioned:

Cara Esser: The long-tenured managers of Lord Abbett Total Return (LTRAX) add value by rotating among bond sectors based on broad-market trends, moving into sectors with the best perceived risk/reward trade-offs and out of those that managers believe are overvalued or do not offer enough upside potential for the risk. 

Top-down strategies like this can be difficult to execute consistently, but the team has managed to avoid major pitfalls over the years. The fund's 5% annualized gain during the trailing 10 years through Aug. 31 was better than 80% of peers.

Cara Esser does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.