There has been minimal discrepancy between the performance of Australian and international bond funds as countries around the world adjust to a low, or even negative, interest rate environment.
According to FE Analytics, within the Australian Core Strategies universe, there were 81 funds with a one-year track record in the Australian bond sector, and 79 in the international sector.
The average global bond returned 1.6% while the average Australian bond returned 1.5%.
The best-performing Australian bond fund was Elstree Enhanced Income which returned 4.78% over one year to 31 August, 2020, followed by Janus Henderson Tactical Income which returned 3.4%.
Jay Sivapalan, head of Australian fixed interest at Janus Henderson, said: “Asset allocation including a greater exposure to lower duration floating rate assets relative to longer duration fixed interest helped preserve capital from rising bond yields.
“Allocations to spread sectors including exposure to semi-government bonds, investment grade credit added value. Meanwhile, a greater than average allocation to opportunistic higher yielding credit boosted returns for investors.
“This smaller but powerful allocation included some underlying exposure to...
