Market insight: Revisiting active versus passive in fixed income
Although passive investing has clearly gained favor over the last decade, arguments for passive equity strategies generally do not apply to fixed income. In fact, most active fixed income managers have a proven track record of outperforming market indices and the difference between active and passive strategies is significantly smaller.
And with aging plan participants, the demand for fixed income will continue to increase for many of them as they seek to mitigate risk into retirement. This demographic shift is coinciding with a significant change in the fixed income market, as interest rates have finally started to rise.
So how can DC sponsors best evaluate passive and active strategies’ ability to deliver optimal retirement outcomes? Check out Voya’s latest market insight paper: New Risks Emerge for Aging Plan Participants: Revisiting active versus passive in fixed income to learn more.
 Source: Morningstar and Voya Investment Management. Net returns based on Morningstar Intermediate-Term Bond category; rolling 5-year time periods on a quarterly basis (21 total time periods).
 As of 06/30/2018. Source: Morningstar and Voya Investment Management. The Intermediate Bond universe is represented by Morningstar’s U.S. Fund Intermediate-Term Bond category. The U.S. Equities universe is represented by Morningstar’s U.S. Fund Large Blend category. The passive sleeve of each universe comprise strategies identified by Morningstar as index funds. The equity universe was screened to remove index funds that include numerous short positions, track a proprietary, non-standard index and include high levels of emerging markets and preferred securities.
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