Is it fairly likely that the fund will hold the bonds till maturity and I will receive 100p on the pound? Or do actively managed bond funds like to buy and sell?
Bonds are complicated investments.
Ahh, ok
It's a bond index tracker fund. It matches (to within proscribed margin of error) a bond index.
Basically it buys the underlying constituents of the underlying index (with a bit of tweaking around the edges)
As the index "offers exposure to Sterling denominated corporate bonds with an expected remaining time to maturity between 1 and 5 years", then as a bond gets within 1 year to maturity, it'll drop out of the index and therefore will be sold by the fund.
Is it fairly likely that the fund will hold the bonds till maturity and I will receive 100p on the pound? Or do actively managed bond funds like to buy and sell?
I would have thought these things would be tracking the underlying index to a margin of error of +/- 0.5% of the index.
I meant how well does a bond index fare over the long term. Whats they average rate of return?
how long is a piece of string ?
you need to speak to an independent financial adviser. try going to Unbiased - Find an Independent Financial Adviser (IFA), Mortgage Adviser, Accountant or Solicitor to find one in your local area.
So how well do these index bond funds fare over the long term? Im looking at either a gilt or investment grade corporate bond index to supplement my ETF FTSE 100 index.
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