Explore RBC’s Fixed Income Mutual Fund Offering
Money market and bond funds offer investors another way to gain fixed income exposure. Bond mutual funds offer the following advantages over portfolios composed of individual bonds:
- Liquidity: Bond funds are liquid investments that provide that allow for easier reinvestment and provide convenient exposure to the bond market.
- Diversification: Fund managers can diversify by sector, credit quality, and maturity more easily – as they have access to larger capital pools. Bond funds may also have access to restricted securities that individual investors do not.
- Stable Income: Bond funds can provide regular monthly income.
- Active Management: Bond funds employ fund managers to actively manage their bond portfolios, allowing for ongoing participation in the market, which can reduce the impact of changing interest rates.
Through money market and fixed income funds, you have access to professional management which includes more in-depth analysis, research and greater diversification.
Money Market Funds
These funds invest primarily in T-bills and other high-quality, low–risk, short-term investments. Offering stability and minimal risk, money market funds deliver returns in the form of regular monthly distributions that are typically better than those of a traditional bank account. If you have short-term goals or want to be able to access your funds in case of an emergency, money market funds are an appropriate investment solution.
Fixed Income Funds
By investing in fixed income securities such as mortgages, bonds and preferred shares, fixed income funds offer regular cash flow while preserving capital. These funds typically distribute interest income and provide potential for capital gains. Fixed income funds may also be used to help diversify an investment portfolio.