Benzinga  Nov 20  Comment 
As is the case with equity-based exchange traded funds, fixed income ETFs are enjoying a record pace of asset gathering in 2017 and low-cost bond funds are leading that charge. One of the low-cost leaders among bond ETFs is the Vanguard Total Bond...
Clusterstock  Mar 1  Comment 
The US Treasury market is under pressure following this morning's trio of better than expected economic data. First, Markit's manufacturing purchasing manager's index  (PMI) edged out the 51.2 printed expected by the Bloomberg...
Clusterstock  Jan 13  Comment 
2016 could be the year the 10-year Treasury yield finally rises.  In his latest webcast on the markets and economy, DoubleLine's Jeff Gundlach predicted that this year could be the one the 10-year yield finally rises after years of a continued...
Clusterstock  Nov 12  Comment 
The good old days are never coming back for big banks. Writing in The Financial Times on Wednesday, John Reed, former chairman and CEO of Citigroup, argues that the world's big banks will never return to their precrisis glory days of enjoying...
Clusterstock  Sep 30  Comment 
This chart is just the worst.  Via Deutsche Bank's Torsten Sløk, this chart shows the decline in where Wall Street analysts thought the 10-year Treasury note would finish 2015.  Last summer, everybody thought yields were going higher and...
Clusterstock  May 21  Comment 
Howard Marks thinks almost everything an investor can buy today is expensive. In an interview with Bloomberg News, Marks said: "We are at a point in the cycle where we feel virtually all assets are trading above their intrinsic value; some are...
Financial Times  May 6  Comment 
The BND affair is beginning to dent public confidence in leader
Forbes  May 5  Comment 
Comparing units outstanding versus one week ago at the coverage universe of ETFs at ETF Channel, the biggest inflow was seen in the Vanguard Total Bond Market ETF (BND), which added 5,700,000 units, or a 1.8% increase week over week.


The Vanguard TTL Bond Mktetf (NYSE: BND) is an Exchange Traded Fund (ETF) that tracks various bonds. The ETF includes a variety of fixed income bonds, including treasury bonds, investment grade bonds, and municipal bonds. The inconsistent performance of risk markets caused BND's performance to also be inconsistent in the past fiscal year. Interest rate levels also drive the value of the bonds that BND holds.

Business Growth

In the past fiscal year, BND has seen inconsistent growth, as riskier, higher-returning assets (such as stocks) have seen growth, but have struggled to fully recover from the recession. In the current fiscal year, BND's performance will hinge upon equities growth and the amount of debt issuance.[1]

Trends and Forces

BND's Performance is at Risk to Interest Rates

In general, as interest rates rise, bond prices fall (and vice-versa) due to discounting. From this, BND's performance is dependent on the interest rate levels. Interest rate levels are determined by the Federal Reserve, who control money supply in the U.S.[2]

Bonds are Anti-Correlation with Equities

Equity securities, such as stocks and stock market indices, typically garner a higher return than bonds at the cost of a higher risk of losing money. From this, investors would rather buy equities than bonds in low-risk environments (such as growth periods in the U.S. economy), and would rather buy bonds than equities during high-risk environments (such as recessions).[3]



  1. Seeking Alpha, "Enhancing Fixed Income Returns," 05/16/2011
  2. iStockAnalyst, "U.S. Total Bonds Led By These Etfs (AGG, BND, BIV, PCEF)," 04/27/2011
  3. Seeking Alpha, "ETF Buying Patterns Suggest 'Risk-Off' Trade," 05/19/2011
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