Vanguard’s Fixed Income Group, with $1.2 trillion of assets under management, is overweight on credit exposure to corporate bonds and asset-backed securities, targeting more defensive sectors because they are “less subject to some of the volatility,” according to the group’s global head.
“We’re at the lower end because we feel that the bond market credit spreads are relatively low,” said John Hollyer, who has been with Vanguard for 28 years, in an interview with TheStreet.
Hollyer acknowledged that “on a short-term basis, equity values are higher than average,” adding that the U.S. has a reasonably stable economic outlook.
