Bond markets have been volatile lately, but some multisector bond funds have managed to deliver stronger returns than the broader bond market. These funds diversify across different fixed-income sectors, such as government, corporate, high-yield, and foreign bonds. 

Over the past year, the category has returned 5.93%, better than the Morningstar U.S. Core Bond Index’s 5.66%, and it has also outperformed over three- and five-year periods. A screen for the best performers by one-, three-, and five-year results highlighted three actively managed funds: Axonic Strategic Income Fund (AXSIX), DoubleLine Flexible Income Fund (DFFLX), and NYLI MacKay Strategic Bond Fund (MSYEX). 

Each has topped peers recently, with returns ranging from about 7% to nearly 8% over the last year. 

Finsum: For investors looking to reduce volatility while maintaining competitive returns, these funds show the potential benefits of a multisector approach.