What is barclays aggregate bond index

The background As portfolio management techniques advanced in the s, it became increasingly important to measure bond performance. So in , a bond index was created, and after a series of acquisitions culminating in , it became known as the Bloomberg Barclays U. Aggregate Bond Index or the Agg. The Agg is weighted toward the companies and agencies that have the most debt. Arguably, this approach works because the size of a company can be indicative of its success. The largest components of the Agg are the companies and agencies with the most debt outstanding.

The Agg is heavily weighted toward U. The top two components of the Agg — U. That means that historically, returns for those sectors moved in the same direction most of the time. Less-correlated sectors either form a much smaller component of the Agg or — in the case of sectors like U. The bond benchmark represents the largest issuers of debt, but not necessarily the best opportunities for fixed-income investors.

We believe fixed-income investors should look beyond the benchmark. To learn more about the Agg and solutions to its shortcomings, read our white paper. Download the whitepaper. Download this article as a PDF. Tagged with: Fixed Income.

The Bloomberg Barclays U. Aggregate Bond Index the Agg is a broad-based benchmark that measures the investment grade, U. Past performance is not a guarantee of future results. It is not possible to invest directly in an index. Bloomberg Index Services Limited. Bloomberg owns all proprietary rights in the Bloomberg Indices. Bloomberg does not approve or endorse this material, or guarantee the accuracy or completeness of any information herein, or make any warranty, express or implied, as to the results to be obtained therefrom and, to the maximum extent allowed by law, shall not have any liability or responsibility for injury or damages arising in connection therewith.

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We and our partners process data to: Actively scan device characteristics for identification. I Accept Show Purposes. Your Money. Personal Finance. Your Practice. Popular Courses. Bonds Fixed Income Essentials. What Is the Agg? Key Takeaways The Agg is an index that broadly tracks the U. The index is composed of a range of securities from corporate bonds and Treasuries to asset-backed securities.

Compare Accounts. The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace. Related Terms Understanding the Bond Market The bond market is the collective name given to all trades and issues of debt securities.

Learn more about corporate, government, and municipal bonds. Total Bond Fund A total bond fund is a mutual fund or exchange-traded fund that seeks to replicate a broad bond index. Index Funds: How They Work, Pros and Cons An index fund is a pooled investment vehicle that passively seeks to replicate the returns of some market indexes.

What is a Debt Fund? A debt fund is an investment pool, such as a mutual fund or exchange-traded fund, in which core holdings are fixed income investments. Bond ETF Bond ETFs are very much like bond mutual funds in that they hold a portfolio of bonds that have different strategies and holding periods. Partner Links. Related Articles. Investopedia is part of the Dotdash publishing family.