Money has been pouring into bond funds globally this year, but income investors should tread carefully.
Net buying in global bond funds is on pace to reach a “staggering record” of $455 billion in 2019, according to BofA Merrill Lynch Global Research. That compares with the $1.7 trillion of inflows over the past 10 years. The accompanying table lists six bond exchange-traded funds with assets totaling about $170 billion.
While some of the hefty buying could be related to income investors, it likely isn’t for the yields that return-hungry investors crave: The 10-year U.S. Treasury note was recently at 2.06%, down from 3.2% last November.