July 12, 2022

Fixed Income Funds Realize Worst Quarterly Performance Since Volcker Era

by Jack Fischer.

Former U.S. Federal Reserve Chairman Paul Volcker

Fixed income funds realized a return of negative 5.21% on average during the second quarter of 2022, marking the worst quarterly performance in more than 40 years (Q3 1981, -7.06%). This was the second consecutive negative quarterly performance for fixed income funds and the third over the last four quarters.

All 51 Lipper fixed income classifications ended the quarter with sub-zero quarterly performance for the second straight quarter. Four Lipper classifications finished the quarter realizing less than 1.0%, which is up from three in Q1 2022.

Summary:

  • Taxable bond funds (-5.83%) underperformed tax-exempt bond funds (-3.53%) in quarterly performance for only the third quarter in the last nine.
  • Of the macro-groups, National Municipal Debt Funds (-1.65%), Single State Municipal Debt Funds (-3.73%), and Short-Term/Intermediate Corporate Funds (-3.82%) suffered the least.
  • World Taxable Fixed Income Funds (-9.02%), General Domestic Taxable Fixed Income Funds (-7.26%), and General Municipal Debt Funds (-4.87%) closed the quarter as the worst-performing macro-groups.
  • Our top three Lipper classifications over the quarter were Short Municipal Debt Funds (-0.36%), Short U.S. Treasury Funds (-0.39%), and Ultra-Short Obligations Funds (-0.49%).
  • The worst-performing classifications on average were Alternative Currency Debt Funds (-14.13%), Emerging Markets Hard Currency Debt Funds (-10.50%), and Global High Yield Funds (-9.65%).

Click here or the Download Full Report link in the upper right-hand column of this page to download the First Quarter 2022 FundMarket Insight Report: Fixed Income Funds RealizeWorst Quarterly Performance Since Volcker Era

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