Fixed-income solutions

What is fixed income?

When it comes to investing, many people start with equities (also known as stocks). While most investors understand that stocks are shares in the ownership of a company, the role of bonds (also known as fixed-income securities) may not be as clear.

When a company needs money to expand or grow its business, it can also issue debt in the form of fixed-income securities, which can trade on the bond market, just like equities trade on the stock market. Fixed-income securities are any investment in which the issuer is obliged to make a fixed payment on a fixed schedule, although the amounts of the payments can vary.

Reasons to consider fixed-income funds

When you buy a fixed-income mutual fund or ETF, you are indirectly buying the debt that a company, government or government agency has issued.

Fixed-income funds can play an important role in your investment strategy by helping to potentially deliver income, offset some stock market risk in your portfolio and manage volatility. The fixed-income category includes fixed-income securities and funds, ETFs and GICs.

Fixed-income funds may help:  

Generate income Preserve capital Lower portfolio volatility
The coupon payments bonds offer can help build an income stream that can be reinvested or used to manage cash-flow needs. Repayment of the bond’s original investment can help investors protect capital and meet financial needs.
Bonds are often less volatile than stocks and can help lower a portfolio’s risk.

What type of fixed-income funds might work for your investment strategy?

Investment-grade solutions
May help to protect against stock market volatility.
Multi-sector solutions
A one-ticket solution – balance steady income with potential for growth.
High-yield solutions
Achieve higher yield and return potential.

Matching fixed-income funds to investment goals

As with many investment decisions, the process starts with your specific investment goals, time horizon and tolerance for risk. Here are some general guidelines; you and your advisor will need to determine if they apply and how they are relevant to your individual situation.

If your goal is to: Consider the following type of fixed-income fund(s):
Help protect against stock market downturns An investment-grade core solution
Increase income potential A high-yield solution
a multi-sector solution
Meet an approaching goal A short-term investment-grade solution

Invest with an experienced fixed-income manager

Fidelity offers a comprehensive lineup of products designed to meet investor needs for diversification* and income. Our investment capabilities extend globally, connecting hundreds of fixed-income professionals with hundreds of equity professionals analyzing the same companies. Fidelity’s fixed income and equity research analysts work together to develop a 360-degree view by hearing a company’s pitch to both bond holders and shareholders – not just one or the other – and exchange their insights. Our product development and asset allocation teams are constantly reacting to changing market and credit conditions to offer investment solutions for today and the future.

A global network
A wide investment reach through Fidelity’s extensive global network of credit specialists, equity analysts, and asset allocation professionals.
Integrated perspective
Connecting fixed-income investment professionals with equity investment professionals to gain a 360-degree view of the capital structure.
Systematic approach
A team-based investment approach that is clearly defined and repeatable and that fosters deeper levels of collaboration.

Related content:

Related funds

Canadian Fixed-Income Funds

U.S. Fixed-Income Funds

Global Fixed-Income Funds

Private Investment Pools

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