Were global or Australian bonds better in 2019?
The fixed interest global bond sector performed better than its Australian counterpart in 2019, but over a larger time-frame the difference remains negligible, according to data.
FE Analytics data has showed that within the Australian Core Strategies universe the global bond sector returned 7.26%, followed by Australia/global bond (6.31%), Australian bond (5.79%) and global strategic bond (4.29%) over the year to 31 December, 2019.
Although the Australia/global bond sector performed in between the individual global and Australian bond sectors, this does not trend over a longer time scale.
Annualised returns over the three years to 31 December, 2019, the sector returned less than the individual global and Australia bond sectors, however over 10 years annualised, it outperformed them.
Annualised returns for ACS fixed interest Australian and global bond sectors
|
1yr |
Ann. 3yr |
Ann. 5yr |
Ann. 10yr |
|
|
ACS Fixed Int Global Bond |
7.38% |
4.13% |
3.67% |
4.94% |
|
ACS Fixed Int Australia/Global Bond |
6.73% |
4.05% |
3.55% |
5.17% |
|
ACS Fixed Int Australian Bond |
6.19% |
4.09% |
3.40% |
4.89% |
|
ACS Fixed Int Global Strategic Bond |
4.22% |
2.87% |
3.33% |
5.03% |
Source: FE Analytics
The top performing funds in the global bond sector were CFS US Select High Yield A (16.05%), CFS High Quality US High Yield A (15.27%), Colchester Emerging Markets Bond I (13.45%), Schroder Global Corporate Bond Inst (13.34%) and Mercer Emerging Markets Debt (12.08%).
The best performing Australian bond funds were OnePath Optimix Wholesale Australian Fixed Interest Trust A (9.13%), Russell Australian Government Bond ETF (8.88%), Mercer Australian Sovereign Bond (8.54%), SSgA SPDR S&P/ASX Australian Government Bond (8.2%) and SSgA SPDR S&P/ASX Australian Bond (8.1%).
The best performing Australia/global bond funds were CFS FirstChoice Wholesale Fixed Interest (8.04%); Pimco Diversified Fixed Interest (7.46%); IOOF MultiMix Diversified Fixed Interest (7.38%); BT Wholesale Multi-manager Fixed Interest (7.31%); and Vanguard Wholesale Diversified Bond Index (7.3%).
Looking at how the Australian/global funds allocated to each region, three of the top five were close to 50/50, but the best performer had two-thirds focused globally.
Table 2: Australia/Global Bond funds investment breakdown
|
|
Global |
Aus |
|
CFS FirstChoice Wholesale Fixed Interest |
67.79% |
28.49% |
|
Pimco Diversified Fixed Interest |
53.64% |
46.36% |
|
IOOF MultiMix Diversified Fixed Interest |
44.15% |
52.94% |
|
BT Wholesale Multi-manager Fixed Interest |
49.08% |
49.60% |
|
Vangaurd Wholesale Diversified Bond Index |
68.80% |
31.00% |
Australian and global bond sectors performance in 2019
AUTHOR
Chris Dastoor
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