It is important to note that not all fixed-income sectors react the same way to economic and interest-rate changes. Bonds are affected by interest-rate movements. Bond prices and, likewise, a bond fund’s share price generally move in the opposite direction of interest rates. As the prices of bonds in a fund adjust to a rise in interest rates, a fund’s share price may decline. Investors should be aware of the special risks involved with investments in high-yield bonds and floating-rate loan funds. High-yield bond and floating-rate funds invest in lower-rated, higher-yielding instruments, which are subject to increased risk of default and can potentially result in loss of principal. Mortgage-backed securities are susceptible to prepayment risk. Changes in the financial strength of a bond issuer or in a bond’s credit rating may affect its value. For this reason, it is essential to make sure the fixed-income allocation of your portfolio is well diversified. Please remember, past performance does not guarantee future results and diversification does not ensure a profit or protect against a loss. It is important that you work with your clients to determine which fixed-income allocations would be most appropriate for their situation, based on their investment goals, risk tolerance level, and investment horizon.