Fixed-income investing at John Hancock Investment Management
Fixed-income investments have a vital role to play in a broad range of diversified portfolios, from dampening equity volatility to providing current income.
The new challenges created by the new normal
For more than a decade, central banks around the world have kept interest rates low to try to stimulate local economies—with varying degrees of success. But this new normal comes at a price for fixed-income investors: With less income produced, it’s less likely that traditional segments of the bond market will be able to generate the kinds of returns they have in the past.
The decades-long decline in interest rates has made generating income harder than ever
Traditional portfolios could be riskier than ever
Not only does today’s low interest-rate environment affect bonds’ total return potential, but it also presents new risks. Because of higher duration (i.e., sensitivity to rate movements) and lower yields, global bonds are less equipped than ever to withstand a sharp rise in rates. A 100 basis point jump in rates could cause significant losses in benchmark-oriented portfolios.
A passive approach to fixed income has become increasingly vulnerable to rising rates
Effective diversification requires understanding the market’s nuances
Different segments of the bond markets perform very differently from each other depending on the overall market environment. For example, long-term U.S. Treasuries have historically been an excellent hedge against stock market risk, while high-yield bonds, on the other hand, have performed well when the economy is expanding. Each segment can offer distinct benefits to a portfolio, but entails its own particular risks.
Building a better portfolio begins with defining its goals¹
Not every investor buys bonds for the same reason. Some are seeking to generate a certain level of income, others are looking to add stability to their portfolios, and others want a combination of both. Defining your goals when it comes to the role of fixed income in your portfolio can help inform which segments of the bond market are worth an allocation—and which you may want to avoid.
Finding the best specialized manager for every fund we offer
Our multimanager approach puts us in a uniqe position to evaluate the skill sets, track records, and experience of today's portfolio managers, and our fixed-income lineup features a range of portfolios managed by some of the industry's best teams.
|TICKER||FUND NAME||MANAGED BY||MORNINGSTAR CATEGORY||USE FOR|
|JHBIX||Bond Fund||Manulife Investment Management||Intermediate Core-Plus Bond||Diversifying income holdings|
|JCAFX||California Tax-Free Income Fund||Manulife Investment Management||Muni California Long||Tax planning strategies|
|JBOIX||ESG Core Bond Fund||Breckinridge Capital Advisors||Intermediate Core Bond||Opportunistic fixed-income holding|
|JMKIX||Emerging Markets Debt Fund||Manulife Investment Management||Emerging Markets Bond||Diversifying income holdings|
|JFIIX||Floating Rate Income Fund||Bain Capital Credit||Bank Loan||High current income and reducing interest-rate risk|
|JGIFX||Government Income Fund||Manulife Investment Management||Intermediate Government||High-quality income opportunities|
|JYHIX||High Yield Fund||Manulife Investment Management||High Yield Bond||Generating income|
|JHYMX||High Yield Municipal Bond Fund||Manulife Investment Management||High Yield Muni||Tax planning strategies|
|JSTIX||Income Fund||Manulife Investment Management||Multisector Bond||Diversifying income holdings|
|JHS||Income Securities Trust||Manulife Investment Management||Closed-End Intermediate Core-Plus Bond||Diversifying income holdings|
|TIUSX||Investment Grade Bond Fund||Manulife Investment Management||Intermediate Core Bond||High-quality income opportunities|
|JHI||Investors Trust||Manulife Investment Management||Closed-End Multisector Bond||Diversifying income|
|HPI||Preferred Income Fund||Manulife Investment Management||Closed-End Preferred Stock||Diversifying sources of income|
|HPF||Preferred Income Fund II||Manulife Investment Management||Closed-End Preferred Stock||Diversifying sources of income|
|HPS||Preferred Income Fund III||Manulife Investment Management||Closed-End Preferred Stock||Diversifying sources of income|
|JSNIX||Short Duration Bond Fund||Manulife Investment Management||Short-Term Bond||High-quality income opportunities and reducing interest-rate risk|
|JMBIX||Short Duration Credit Opportunities Fund||Stone Harbor Investment Partners||Multisector Bond||Diversifying income holdings and reducing interest-rate risk|
|JIPIX||Strategic Income Opportunities Fund||Manulife Investment Management||Multisector Bond||Diversifying income holdings|
|JTBDX||Tax-Free Bond Fund||Manulife Investment Management||Muni National Long||Tax planning strategies|
Investing involves risks, including the potential loss of principal. These products carry many individual risks, including some that are unique to each fund. Please click a fund's name above to learn all of the risks associated with each investment.