Investor Summary
Fund Strategy
FUND PERFORMANCE AS OF 31st March 2026
| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 6.61% | -0.16% | -0.16% |
| ANNUALIZED SINCE INCEPTION | QUARTERLY | YTD |
|---|---|---|
| 6.61% | -0.16% | -0.16% |
The John Hancock Bond Fund slightly underperformed its benchmark in Q1 2026, returning -0.16% versus the Bloomberg U.S. Aggregate Bond Index's -0.05%. The quarter began positively with steady economic growth and expectations of continued Fed rate cuts, but March's Middle East conflict onset triggered commodity price spikes and elevated inflation expectations, reducing prospects for meaningful monetary easing. Asset allocation was the primary performance detractor, particularly overweights in investment-grade corporate and high-yield bonds which lagged due to widening spreads. However, overweights in agency MBS, ABS, and CMBS contributed positively. The managers reduced agency MBS allocation while increasing investment-grade corporates and adding securitized credit where yields appeared compelling. Duration was moved slightly above benchmark following March's sell-off. Despite geopolitical uncertainty, the team avoided reactive positioning changes, maintaining their view that conditions will gradually normalize. They expect higher yields to support fixed-income demand for the remainder of 2026, with stable credit fundamentals supporting their optimistic outlook for another positive year.
The fund maintains a diversified fixed-income approach focused on generating high current income through strategic allocation across investment-grade corporates, securitized credit, and agency MBS while positioning for gradual market normalization despite geopolitical headwinds.
Overall, we think higher yields should be supportive of fixed-income demand over the remainder of the year. Credit fundamentals remain stable, and we believe the combination of our bottom-up approach and long-term focus should help the fund capitalize on what we anticipate will be another positive year for fixed income.
| Date | Letter | Tickers | Keywords | Pitches | Quick Takes |
|---|---|---|---|---|---|
| Apr 18 2026 | 2026 Q1 | - | Bonds, credit, duration, fixed income, rates, yield curve | - | John Hancock Bond Fund underperformed in Q1 2026 as Middle East conflict sparked commodity price increases and inflation concerns, reducing Fed easing prospects. Asset allocation detracted from performance, particularly corporate bond overweights. Managers repositioned toward securitized credit while maintaining conviction that market conditions will normalize and higher yields will drive fixed-income demand. |
| Feb 3 2026 | 2025 Q4 | AAL, BAC, DELL, F, FMCC, FNMA, JPM, WFC | Bonds, credit, duration, Fed policy, fixed income, Mortgage | - | Bond fund managers reduced corporate exposure due to tight spreads while adding securitized credit positions for better risk-return. Maintained agency MBS overweights and neutral duration with yield curve steepening bias. Expect Fed caution and increased volatility ahead but see opportunity in elevated longer-term yields supporting fixed-income demand. |
| Oct 19 2025 | 2025 Q3 | AVGO, BAC, DELL, ET, F, JPM | Bonds, credit, duration, Fed policy, fixed income, rates, yield curve | - | The fund outperformed through credit overweights as the Fed began cutting rates and credit spreads tightened to historical lows. Managers added to investment-grade and high-yield bonds while moving up in quality, maintained agency MBS overweights for relative value, and positioned for yield curve steepening amid expectations for continued Fed easing. |
| Jul 22 2025 | 2025 Q2 | AVGO, BAC, DELL, ET, F, JPM | Bonds, credit, duration, Fed policy, fixed income, rates, yield curve | - | John Hancock Bond Fund outperformed through strategic credit overweights, particularly high-yield bonds and agency MBS, capitalizing on Fed rate cuts and strong corporate fundamentals. The fund maintains neutral duration while positioned for yield curve steepening, emphasizing security selection over risk-taking given compressed spreads and ongoing market uncertainty. |
| Mar 31 2025 | 2025 Q1 | BAC, ET, F, JPM, NRG, WFC | Bonds, credit, duration, Fed policy, fixed income, MBS, rates | - | John Hancock Bond Fund returned 2.71% in Q1 but underperformed due to high-yield exposure amid tariff-driven growth concerns. Managers maintained MBS overweight for relative value, positioned for Fed cuts through intermediate duration bias, and emphasized quality selection as credit spreads stayed compressed. Fund positioned defensively for ongoing policy volatility. |
| QUARTER | THEMES | TAGS |
|---|---|---|
| 2026 Q1 |
RatesFed expected to maintain cautious approach to monetary policy changes due to geopolitical uncertainty and market volatility. Negative labor market trends continue but potential for higher inflation suggests balanced, data-driven approach to future action. |
Interest Rates Federal Reserve Monetary Policy Inflation Labor Market |
GeopoliticalConflict in Middle East started in March causing sharp rise in crude oil prices and commodity shortages. This pushed inflation expectations higher and reduced odds of meaningful Fed policy easing. |
Middle East Conflict Oil Prices Commodities Inflation Expectations | |
CreditCredit fundamentals remain stable despite elevated volatility. Investment-grade corporates and high-yield bonds lagged due to widening yield spreads, while securitized credit outperformed Treasuries. |
Credit Spreads Investment Grade High Yield Fundamentals Securitized Credit | |
| 2025 Q4 |
AIManager believes market's assessment of AI risk differs from their own, with approximately 60% of underperformance attributed to positions where AI impact concerns drove stock declines. Portfolio companies deemed AI-losers declined 15% despite 10% revenue growth and 15% EPS growth, representing valuation compression rather than fundamental deterioration. |
Artificial Intelligence Disruption Valuation Technology Software |
QualityFund exclusively invests in businesses with superior characteristics including high barriers to entry, sustainable competitive advantages, and durable growth prospects. Manager emphasizes that Earnings Quality factor performance was in 100th percentile, demonstrating the portfolio's high-quality nature despite recent underperformance. |
Quality Investing Competitive Advantages Earnings Quality Sustainable Growth | |
Small CapsStrategy of owning competitively advantaged small and medium-sized businesses remained out of favor for most of the quarter. Fund focuses on businesses that were small-cap at time of purchase and have grown through stock appreciation, with weighted average holding period of 18.6 years. |
Small Cap Growth Long Term Compounding | |
FinancialsFinancials represent 62.1% of net assets with mixed performance during the quarter. Arch Capital and MSCI contributed positively while Kinsale Capital and Choice Hotels detracted. Specialty insurers like Arch showed strong earnings and active capital management. |
Insurance Specialty Finance Capital Management | |
| 2025 Q3 |
RatesThe Fed cut interest rates by a quarter point in September, its first reduction since December 2024, driven by softening labor market conditions. Investors are factoring in potential for further Fed easing before year end and additional cuts in 2026, despite inflation remaining above the central bank's long-term target. The fund expects the Fed will continue to take a cautious, data-driven approach. |
Federal Reserve Interest Rates Monetary Policy Inflation Labor Market |
CreditCredit-oriented sectors performed well, reflecting steady economic growth, robust corporate earnings, and elevated investor risk appetite. High-yield and investment-grade corporate bonds outperformed as yield spreads moved to the low end of the historical range. The fund added to both investment-grade corporate and high-yield bonds, while moving up in quality and emphasizing intermediate maturities given spread compression. |
High Yield Investment Grade Corporate Bonds Credit Spreads Risk Appetite | |
MortgageAgency mortgage-backed securities led securitized assets performance and remained a significant overweight in the portfolio based on high quality and compelling relative value. The fund continued to view agency MBS as attractive relative to corporates despite spread tightening, with holdings focused on the middle of the coupon stack (4.0% to 5.5% coupons) for higher income and prepayment protection. |
Agency MBS Mortgage Backed Securities Prepayment Risk Relative Value Securitized Assets | |
| 2025 Q2 |
RatesThe Fed cut interest rates by a quarter point in September, its first reduction since December 2024, driven by softening labor market conditions. Investors are factoring in potential for further Fed easing before year end and additional cuts in 2026, despite inflation remaining above the central bank's long-term target. The fund expects the Fed will continue to take a cautious, data-driven approach. |
Federal Reserve Interest Rates Monetary Policy Inflation Labor Market |
CreditCredit-oriented sectors performed well, reflecting steady economic growth, robust corporate earnings, and elevated investor risk appetite. High-yield and investment-grade corporate bonds outperformed as yield spreads moved to the low end of the historical range. The fund maintained overweights in credit sectors, particularly high-yield bonds, which was the primary factor in outperformance. |
Corporate Bonds High Yield Credit Spreads Investment Grade Risk Appetite | |
MortgageAgency mortgage-backed securities led securitized assets performance and remained a significant overweight based on the view that they offered both high quality and compelling relative value. Holdings remained focused on the middle of the coupon stack (4.0% to 5.5% coupons) due to higher income and protection against prepayment risk. Despite spread tightening, the category was viewed as attractive relative to corporates. |
Agency MBS Mortgage Backed Securities Prepayment Risk Relative Value Securitized Assets | |
| 2025 Q1 |
RatesThe Trump administration's tariff approach led to concerns about economic growth slowdown, reviving expectations for Fed rate cuts in 2025. More rate-sensitive assets like longer-dated Treasuries registered the largest gains in this environment. |
Fed Treasuries Duration Yield Curve |
Trade PolicyThe Trump administration's approach to raising tariffs on major trading partners created uncertainty about economic growth prospects. The managers maintained a long-term outlook on potential tariff policy impacts as the situation remained highly fluid. |
Tariffs Economic Growth Policy | |
MortgageThe fund maintained a significant overweight in agency MBS on the view that the category continued to offer compelling relative value and higher quality. MBS outpaced Treasuries during the quarter. |
MBS Agency Relative Value |
| Date | Pitch Type | Author | Ticker | Company | Industry | Sub Industry | Bull / Bear | Exchange | Keywords | Action |
|---|---|---|---|---|---|---|---|---|---|---|
| No Elevator Pitches found | ||||||||||
| TICKER | COMMENTARY |
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| No ticker commentary found. | |
| Ticker | Put/Call | Amount Bought | Shares Bought | % Change | Weight % |
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| Ticker | Put/Call | Amount Sold | Shares Sold | % Change | Weight % | Status |
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| Industry | Prev Quarter % | Current Quarter % | Change |
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