Consistency proves elusive for bond managers over five years

Sector focus: Corporate Bonds

Managers in the corporate bond sector claim to have a wider range of variables to deal with than their equity counterparts, which makes it hard for them to maintain consistent first-quartile performance

Consistent annual top-quartile performance is something UK corporate bond managers seem happy to admit is beyond them. In the period since 1999, the best a fund has achieved is to be top quartile in three out of these five years. Managers in the sector point to a narrow breadth of returns within the peer group as a key reason why it is so easy to slip out of the top quartile - unlike equities, where the dispersion of returns is often far greater. Furthermore, they suggest that bond managers have far more factors to take into account than for their equity counterparts, making it tougher ...