While the April 2 tariff announcements were more severe than anticipated, Vanguard’s active fixed income managers were well-prepared for the subsequent market reaction, having trimmed credit risk and moved up in quality, while utilizing duration as a hedge. Amid continued market and policy uncertainty, fixed income remains a crucial component of a diversified investment strategy—serving as a long-term portfolio ballast and providing attractive yields by historical standards.

The U.S. Treasury debt market is the deepest and most liquid sovereign bond market in the world, offering investors easy access to bonds free of credit risk.

Investors are uneasy. To make sense of today’s volatility, it can be helpful to look at the past. It demonstrates that volatility isn’t one-directional or constant in magnitude, nor is it always spurred by the same type of risk.

The impacts of artificial intelligence (AI) could lead to the most rapid productivity and economic growth in a generation. As Vanguard Global Chief Economist Joe Davis explains, AI is expected to support most professions by improving efficiencies and allowing workers to focus on higher-value responsibilities. This Q&A is one in a series featuring Davis’s research on megatrends and the future impact that AI could have on productivity and the U.S. workforce. For more insights, visit our Megatrends hub.