Canyon's Bond Portfolio "Void Of Duration" As Concerns Exist

Bond fund manager looks towards industries with regulatory uncertainty for higher yield

It might be a difficult time to be a bond investor with a long mandate along the yield curve. The past twenty years have seen one of the most persistent bull market trends. But now, with ten year note yields at historic lows, the coming bond market could define the winners and losers unlike a bull market would.

Volatility in bond markets, as witnessed on October 14, 2014 and on display over the past month, can be a more difficult trading environment than what has been a generally slow and deliberate price moves higher, yields lower over the past 20 years.

Consider the yield on the ten year note over the past month and recognize the difficult market in which bond managers are asked to deliver performance. In one month, the ten year yield moved from 2.2 percent to a low of 1.7 percent and then quickly turned around to recover back to near 2.2 percent yield again over the course of 20 trading days.