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Absolute Return Bonds Guide
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Absolute & Total Return
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The distinction between absolute and total return
It is important that clients fully appreciate the difference between the concepts of absolute and total return. In our view, the differences are as follows:
Total return funds
- these invest so that their return comes from a combination of income and capital growth. A total return fund may often have an index or peer group benchmark.
Absolute return funds
- in contrast, these funds aim to preserve a client's capital and consistently to achieve positive returns. Consequently, they are generally measured against cash, thereby having an 'absolute' benchmark.
Both total and absolute return funds can fall in value.
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Data provided by FE fundinfo. Care has been taken to ensure that the information is correct, but FE fundinfo neither warrants, represents nor guarantees the contents of information, nor does it accept any responsibility for errors, inaccuracies, omissions or any inconsistencies herein. Past performance does not predict future performance, it should not be the main or sole reason for making an investment decision. The value of investments and any income from them can fall as well as rise.
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