The November issue of our Bond Fund Intelligence, which will be sent to subscribers Monday a.m., features the stories, "Muni Bond Funds Battered But Making a Comeback," which details the challenges and recent rebound of tax exempt bond funds; and "PIMCO's Sonali Pier Talks Multisector BFs w/Barron's," which excerpts from an interview on strategy and credit markets. BFI also recaps the latest Bond Fund News and includes our Crane BFI Indexes, which show that bond fund returns were higher again in October while yields moved lower. We excerpt from the new issue below. (Contact us if you’d like to see our latest Bond Fund Intelligence and BFI XLS spreadsheet, or our Bond Fund Portfolio Holdings data.)
BFI's lead article states, "Morningstar writes that, 'Muni Bonds Are Looking Better,' and states, 'Despite offering historically attractive after tax yields, municipal bonds were one of the worst-performing sectors in the fixed-income market through the first nine months of 2025. It's been a risk-off year for munis: While the median total return for a strategy in the intermediate core bond and high-yield bond Morningstar Categories was 6.0% and 6.7%, respectively, through September 2025, the same measure for the muni-national long and the high-yield muni categories reflected modest gains of 1.7% and 1.3%.'"
It continues, "They tell us, 'Significant amounts of new municipal-bond issuance (on pace for the largest annual total since 2017), lukewarm investor demand, and underperformance versus Treasuries all pressured prices. Additionally, narrowing credit spreads in the already crowded high-yield muni sector as we entered the year, and some deterioration in credit quality for a few larger issuers left less upside as investors ventured lower down the credit spectrum.'"
Our "PIMCO's Sonali Pier" article states, "Barron's recently interviewed PIMCO's Sonali Pier, who manages multisector bond funds, in the article, 'A 6% Yield Without Much Risk? This Bond Fund Manager Knows Where to Find It.' They write, 'Fixed-income investors got a one-two punch in mid-October: first, with the bankruptcy-protection filing of First Brands <b:>`_, a heavily indebted auto-parts company, and then, separately, when two regional banks had to write down losses on bad loans.... With characteristic understatement [Pier] tells Barron's, 'We had some conversations about it.'"
It continues, "The piece explains, 'The task at hand wasn’t just to review holdings in the bond portfolios she oversees, including the $8.5 billion Pimco Multisector Bond Active exchange-traded fund, but to prepare for investment opportunities to emerge. She isn't looking for distressed bonds at bargain prices. Instead, she wants to be in a position to add more high-quality bonds -- the good stuff that other investors may have no choice but to sell when facing redemptions.'"
Our first News brief, "Returns Higher, Yields Down Again," states, "Bond fund returns were higher again in October and yields moved lower. Our BFI Total Index rose 0.59% over 1-month and rose 5.93% over 12 months. (Money funds rose 4.24% over 1-year as measured by our Crane 100 Index.) The BFI 100 increased 0.58% in Oct. and rose 6.49% over 12 mos. Our BFI Conservative Ultra-Short Index was up 0.36% over 1-month and 4.86% for 1-year; Ultra-Shorts rose 0.34% and 5.12%. Short-Term gained 0.34% and 5.92%, and Intm-Term rose 0.66% in Oct. and 6.74% over 12 mos. BFI’s Long-Term Index was up 0.60% and up 6.40%. High Yield returned 0.35% in Oct. and 7.19% over 12 months."
A second News brief, "The NY Times Writes: 'Bonds Should Be Boring. But They've Been on a Roller Coaster.' The column explains, 'Bonds are supposed to be dull, churning out income with soothing regularity. `But many bond investors have been having a distressing experience lately. For several years, bond prices have been lurching like an out-of-control roller coaster, and holders of bond mutual funds and exchange-traded funds have endured an exceptionally wrenching ride. Bond prices and yields ... move in opposite directions, and because rates have fallen this autumn, there's actually some good news for bond investors. For the year so far, the investment-grade bond benchmark, the Bloomberg U.S. Aggregate Bond Index, has returned more than 7 percent, including dividends.'"
Another brief states: "'AllianceBernstein Enhances ETF Offerings with Two New Fixed Income Conversions,' says a press release. It explains, 'AllianceBernstein ... announced today the launch of two actively managed exchange-traded funds (ETFs) on the New York Stock Exchange: AB New York Intermediate Municipal ETF (NYM) and AB Core Bond ETF (CORB).'"
A BFI sidebar, "Barron's Credit Complacency," says, "Barron's Asks, 'Can Anything Shake Financial Market Complacency? Credit Stress Couldn't Seem to Do It.' The piece states, 'A series of bankruptcies, bad loans, and allegations of fraud by borrowers this month have spooked investors in private credit, a murky, multi-trillion dollar industry where private companies borrow directly from wealthy investors and regional banks, which also lend to private companies. JPMorgan Chase CEO Jamie Dimon warned last week that more credit risks or 'cockroaches' could be lurking in the economy.'"
Finally, another sidebar, "SSIM: Future of Fixed-Income," says, "State Street Investment Management writes, 'From income to outcomes: The evolution and future of fixed income.' The recent 'Insight' tells us, 'Fixed income has undergone a profound transformation in recent years. Once useful mainly for generating income and hedging equity risks, the asset class now plays central roles in portfolios that solve specific, complex challenges for institutional investors.'"
