July 10, 2023


by Jack Fischer.


Fixed income funds realized a return of positive 0.23% on average during the second quarter of 2023, marking the third straight positive quarterly performance. The last time fixed income funds registered three straight quarters of positive performance was from Q2 2020 to Q4 2020.

Of the 51 Lipper fixed income classifications, only 23 ended the second quarter with gains—down from 50 last quarter. Flexible Income Funds, Specialty Fixed Income Funds, Emerging Markets Hard Currency Debt Funds, and Ultra-Short Obligation Funds were the only Lipper classifications to outperform their first quarter returns.


  • Taxable bond funds (+0.28%) outperformed tax-exempt bond funds (+0.07%) in quarterly performance for the third time in the last four quarters—both have also realized three consecutive quarters of plus-side returns.
  • The top performing Lipper classifications throughout Q2 were Emerging Markets Local Currency Debt Funds (+3.20%), Loan Participation Funds (+2.76%), Flexible Income Funds (+2.04%), Emerging Markets Hard Currency Debt Funds (+1.89%), and Short High Yield Funds (+1.60%).
  • General U.S. Government Funds (-1.68%), General U.S. Treasury Funds (-1.57%), Inflation Protected Bond Funds (-1.57%), Intermediate U.S. Government Funds (-1.43%), and Core Bond Funds (-0.85%) closed the quarter as the worst-performing classifications.

Click here or the Download Full Report link in the upper right-hand column of this page to download the Second Quarter 2023 FundMarket Insight Report: SHORT-DURATION FUNDS CONTINUE THEIR DOMINANCE IN THE FACE OF OUTFLOWS

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