City Research Online

The Performance of US Bond Mutual Funds

Clare, A. ORCID: 0000-0002-4180-6778, O’Sullivan, N., Sherman, M. & Zhu, S. (2018). The Performance of US Bond Mutual Funds. International Review of Financial Analysis, doi: 10.1016/j.irfa.2018.12.001


We evaluate the performance of the US bond mutual fund industry using a comprehensive sample of bond funds over a long time period from January 1998 to February 2017. In this one study, we evaluate bond fund selectivity, market timing and performance persistence. We evaluate bond funds relative to their self-declared benchmarks and in terms of both gross-of-fee returns and net-of-fee returns. We document considerable abnormal performance among funds both to the fund (gross returns) and to the investor (net returns). Bond fund performance is found to be superior in the post financial crisis period. However, past strong performance cannot be relied upon to predict future performance. Finally, while some funds exhibit market timing ability; we find a predominance of negative market timing among US bond mutual funds.

Publication Type: Article
Additional Information: © 2018 Elsevier. This manuscript version is made available under the CC-BY-NC-ND 4.0 license
Publisher Keywords: Mutual funds, bond funds, benchmark returns, timing, persistence.
Subjects: H Social Sciences > HG Finance
Departments: Bayes Business School > Finance
Text - Accepted Version
Available under License Creative Commons Attribution Non-commercial No Derivatives.

Download (210kB) | Preview



Downloads per month over past year

View more statistics

Actions (login required)

Admin Login Admin Login