Why Bond Fund Dividends May Continue to Decline

Thursday, November 1, 2012


As interest rates have fallen over the past five years to historically low levels, the dividends that bond funds pay have also been reduced.  The question is whether or not bond funds have adequately cut their dividends to reflect historically low interest rates, or are further dividend cuts likely if interest rates remain low.  Our analysis concludes that significant further cuts in dividends are needed to reflect these historically low rates by many, if not most, investment grade bond funds.

For the entire article, please download the file below.