Selecting fixed income

Learn how to decide which fixed income investments best fit your needs.

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Define your goals.

Define your goals

Whether you're looking to save for a near-term expense, add stability to your portfolio, or create a revenue stream, there are fixed income products for you to consider.

Define your goals
  • Financial goal
  • Fixed income products to consider
  • Financial goal
    I want to protect my investment
  • Fixed income products to consider
    • Short-term CDs (Certificates of Deposit) 
    • Short-term Treasuries 
    • Short-term investment-grade municipal or corporate bonds 
    • Short-term bond funds
  • Financial goal
    I want to add income and balance to my portfolio
  • Fixed income products to consider
    • Short- and intermediate-term Treasuries
    • Short- and intermediate-term agency bonds 
    • Short- and intermediate-term international developed-market bonds 
    • Short- and intermediate-term investment-grade corporate or municipal bonds 
    • Short-term to intermediate-term bond funds 
    • Agency mortgage-backed securities
  • Financial goal
    I want to generate more interest income
  • Fixed income products to consider
    • Long-term Treasury or corporate or municipal bonds 
    • Emerging market bonds or bond funds 
    • Preferred securities or preferred securities funds
Allocation icon

Select an investment allocation strategy.

Select an investment allocation strategy

Create a mix of fixed income investments that balance your portfolio to help meet your goals. These five sample asset allocation plans show how fixed income can be adjusted in your overall portfolio. 

  • Conservative

    Conservative allocation - Fixed income 50% Equities 20% Cash investments 30%

     

     

     

     

     

     

    For investors who seek current income and stability, and are less concerned about growth.

  • Moderately conservative

    Moderately conservative allocation - Fixed income 50% Equities 40% Cash investments 10%

     

     

     

     

     

     

    For investors who seek current income and stability, with modest potential for increase in the value of their investments.

  • Moderate

    Moderate allocation - Fixed income 35% Equities 60% Cash investments 5%

     

     

     

     

     

     

    For long-term investors who don't need current income and want some growth potential. Likely to have some fluctuations in value, but less volatility than the overall equity market.

  • Moderately aggressive

    Moderately aggressive allocation - Fixed income 15% Equities 80% Cash investments 5%

     

     

     

     

     

     

    For long-term investors who want good growth potential and don't need current income. Likely to have a fair amount of volatility, but not as much as a portfolio invested exclusively in equities.

  • Aggressive

    Aggressive allocation - Fixed income 0% Equities 95% Cash investments 5%

     

     

     

     

     

     

    For long-term investors who want high growth potential and don't need current income. May have substantial year-to-year volatility in value in exchange for potentially high long-term returns.

Want help determining an appropriate allocation type for you?

Determine your time frame and the level of risk you're comfortable with.

Maturity timeframe

Traditionally, longer-term bonds produce higher yields but also have higher interest rate risk—the risk that the value of a bond will fall if interest rates rise. Thus, your time frame may be one factor in determining the amount of interest rate risk you're willing to take on.

Maturity timeframe
  • Low interest rate risk
  • Medium interest rate risk
  • High interest rate risk
  • Maturity timeframe
  • Low interest rate risk
    0 - 4 years average maturity
  • Medium interest rate risk
    4 - 10 years average maturity
  • High interest rate risk
    10+ years average maturity

Credit risk

It's also important to consider credit risk—the chance that the issuer of a bond will not be able to repay its debt obligations. With riskier lenders, the return may be higher, but the odds of an investor losing their principal rise.

Credit risk
  • Low credit risk
  • Medium credit risk
  • High credit risk
  • Fixed income products
  • Low credit risk
    CDs, Treasuries, agency bonds, agency mortgage-backed securities
  • Medium credit risk
    Investment-grade corporate or municipal bonds, international developed market bonds
  • High credit risk
    Preferred securities, emerging market debt, high-yield bonds, high-yield municipal bonds, bank loans

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