What is a "bond fund"?
A bond fund is just a mutual fund that is going to go out and invest in bonds, or what we would really consider fixed income. Within the bond funds themselves, there could be many different types of strategies. The key factors we want to look at when we're looking at bond funds is the quality of the bonds that the mutual fund is buying. Usually that will be listed in their perspective so if you hear about a junk fund, they're really going out and buying poor quality bonds. The other thing you might be concerned with is what's the term? Is it a short term bond future or a long term bond fund? That's going to have a factor on what its expected yield is going to be and the expected price volatility within that bond fund.