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Eric Balchunas, senior ETF analyst at Bloomberg Intelligence, draws attention to the risks facing active bond mutual funds amid rising interest rates.
Balchunas notes that these funds, which manage trillions in assets, benefit from being compared to the aggregate benchmark, making them less exposed to the trend of passive investing that has weakened active equity mutual funds.
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Balchunas has previously tracked developments across the fund industry. He reported when Vanguard acquired Altruist to become a custodian for the first time. In a separate note, Balchunas pointed out that IBIT slightly outperformed VOO since its inception, though with higher volatility.