The Long View Sara Devereux: Bonds Are Still Ballast
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Feb 10, 2026 Sara Devereux, Vanguard’s CIO for Fixed Income and former Goldman Sachs partner, discusses Vanguard’s active bond strategies and tech-driven trading. Short takes cover ETF growth, private credit risks, how electronification reshapes bond markets, and whether bonds still serve as portfolio ballast. Listeners hear practical views on sector selection, term-premium concerns, and 2026 macro crosswinds.
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Tech Is Reshaping The Bond Market
- Electronification, automation, and data have transformed fixed-income trading, improving liquidity, price discovery, and analytics.
- ETFs, portfolio trading, and electronic workflows amplify these technology gains.
Build Tech Pillars Around PM Workflows
- Invest in enhanced insights, faster decisions, and optimized execution to scale portfolio managers' impact.
- Use AI/ML for signals, optimization engines for portfolio builds, and liquidity aggregators for execution.
2025: Income Returned To Bonds
- 2025's returns came largely from elevated starting yields (income) plus price gains as inflation moderated and cuts occurred.
- Bonds fulfilled their income and stability roles, protecting portfolios during equity drawdowns.
