Fund Spy

Introducing Two New Morningstar Bond Categories

Sarah Bush

The intermediate-term bond Morningstar Category long ranked as the largest of the fixed-income categories, home to funds that invested primarily in investment-grade fixed-income debt and had durations (a measure of interest-rate sensitivity) that landed in the intermediate-term range. Effective April 30, 2019, we retired the intermediate-term bond category and introduced two new categories: intermediate core bond and intermediate core-plus bond. With a few exceptions, funds that previously landed in the intermediate-term bond category are now assigned to one of these two new categories. The following Q&A provides some background on the changes.

What is the rationale for the changes to the intermediate-term bond category?
Funds in the old intermediate-term bond category shared many characteristics. They invested primarily in investment-grade U.S. fixed-income issues, including government, corporate, and securitized debt, and typically had durations that ranged from 75% to 125% of the three-year average effective duration of the Morningstar Core Bond Index.

Sarah Bush has a position in the following securities mentioned above: PTTRX. Find out about Morningstar's editorial policies.