Troy Ludgood and Thomas O’Connor, CFA—portfolio managers for the Wells Fargo Advantage Total Return Bond Fund—discuss how amplified volatility in the domestic bond markets has provided some compelling opportunities to capture excess returns in recent quarters.
And more important, for investors focused on security selection and relative-value trading, elevated volatility actually created a favorable environment for generating excess returns. Managers with expertise in performing bottom-up fundamental analysis and the ability to transact quickly on their information found some compelling opportunities to collect additional value. We continue to see similar opportunities for excess returns in 2012.
Read the full report and feel free to leave any comments or questions for the team below.
Bond fund values fluctuate in response to the financial condition of individual issuers, general market and economic conditions, and changes in interest rates. In general, when interest rates rise, bond fund values fall and investors may lose principal value. The use of derivatives may reduce returns and/or increase volatility. Certain investment strategies tend to increase the total risk of an investment (relative to the broader market). This fund is exposed to foreign investment risk and mortgage- and asset-backed securities risk. Consult the fund’s prospectus for additional information on these and other risks.
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