Bonds: Total Market
If you're considering a core bond holding for your portfolio, the Vanguard Total Bond Market Index Institutional Fund (VBTIX) is a strong contender worth a closer look. Launched in 1995 and managed by Joshua Barrickman since 2013, VBTIX offers broad exposure to the U.S. investment-grade bond market and has grown to more than $43 billion in assets.
Over the past five years, it delivered an annualized return of -0.94%, but has shown moderate volatility, with a five-year standard deviation of 6.26%—notably lower than the category average of 12%, making it a relatively stable option. With an ultra-low expense ratio of just 0.04% and no sales load, the fund is significantly cheaper than most of its peers, though it does require a high $5 million minimum investment.
VBTIX's beta of 1 suggests it tracks the bond market closely, while its slightly negative alpha (-0.04) reflects challenges in beating the benchmark on a risk-adjusted basis.
Finsum: For large institutions or high-net-worth investors seeking cost-efficient, diversified bond exposure with low volatility, VBTIX could be a foundational piece of a fixed-income strategy.
In today’s unpredictable economic landscape, retirees face mounting challenges in preserving their wealth as traditional strategies like the 60/40 portfolio falter under inflation and synchronized market downturns. The financial turmoil of recent years has exposed the shortcomings of conventional diversification, especially during crises like 2022 when both stocks and bonds fell sharply, undermining retirees’ income and security.
As a result, many advisors now advocate incorporating alternative investments—such as private equity, real estate, and private credit—into retirement portfolios to broaden exposure and potentially enhance returns. Alternatives offer benefits like access to private markets, higher return potential through illiquidity premiums, and diversification through non-correlated strategies.
Additionally, alternative strategies like managed futures and long/short funds can provide “crisis alpha,” cushioning portfolios during volatile markets.
Finsum: While these vehicles carry higher fees, tax complexity, and liquidity constraints, their strategic use can help retirees mitigate risk, sustain income, and better navigate an uncertain financial future.
The bond market is undergoing a profound transformation as actively managed fixed-income ETFs gain traction among investors looking for more agile solutions. These funds combine strategic bond selection with the flexibility and transparency of the ETF format, offering a powerful tool for navigating an environment defined by volatility and uncertainty.
Unlike passive strategies tied to static benchmarks, active managers can explore underfollowed sectors of the bond market, aiming for higher yields and stronger risk management. The ETF Rule of 2019 opened the floodgates for innovation, helping fuel a surge in actively managed ETF launches and inflows, particularly in fixed income.
Investors are drawn to the structure’s real-time trading, lower embedded costs, and resilience in stressed markets—traits that are increasingly valuable in a dynamic rate environment.
Finsum: Active fixed-income ETFs are becoming a key component of modern portfolio construction, reshaping how investors engage with the bond market.
More...
Private credit has grown so large and intertwined with banks and insurers that it now poses a systemic risk in future financial crises, according to a new Moody’s Analytics study co-authored by economists and regulators.
The report warns that the opaque nature of private credit and its deepening ties to traditional finance could amplify financial shocks due to increased interconnectedness. Since the 2008 crisis, banks have reduced lending amid tighter regulations, creating room for private credit funds—often lending to riskier, heavily indebted companies—to flourish with less oversight.
Researchers used business development companies as a proxy for the sector and found their market behavior is now more correlated with broader financial stress than in the past. Although private credit firms argue they are less prone to panics due to their long-term investor base, banks are still deeply exposed through indirect relationships like fund financing and risk transfers.
Finsum: While private markets tend to be insulated from recessions compared to their public counter parts it’s important to keep this risk in mind when investing
Despite recent political pushback, institutional support for ESG (environmental, social, and governance) investing remains strong, with many large investors continuing to prioritize sustainability.
This is good news for ESG-focused ETFs like the Invesco ESG Nasdaq 100 ETF (QQMG) and the ESG Nasdaq Next Gen 100 ETF (QQJG), which could see more adoption as political resistance fades. A 2025 BNP Paribas survey found that 87% of institutional investors have not altered their ESG goals, and 84% expect sustainability progress to continue or accelerate through 2030.
Furthermore, 85% of respondents said they now integrate sustainability criteria into their investment processes. However, challenges persist, including concerns about ESG data reliability, greenwashing, and balancing short-term performance with long-term sustainability.
Finsum: ETFs that aim to address those concerns by tracking transparent, sustainability-aligned indexes with performance in line with their non-ESG benchmarks.
A new Goldman Sachs Asset Management survey shows insurers are increasingly focused on annuities as a retirement income solution amid ongoing market volatility. Sixty-four percent of respondents rank annuities among their top three priorities, with many already offering or considering in-plan annuity options.
Integration into managed accounts and target-date funds is rising, and automatic plan defaults are viewed as key to driving adoption during retirement decumulation. Registered index-linked and guaranteed variable annuities are gaining popularity, and insurers are diversifying underlying indices, with rising interest in AI strategies and international markets.
AI is also being widely adopted, with 90% of insurers seeing it as vital for improving investor understanding, education, and operational efficiency.
Finsum: Registered investment advisers have become the leading growth channel for annuity distribution, surpassing independent firms.