Investing Ideas

Systematic fixed income strategies: An innovative framework for bond investing

The evolution of global markets and technological advances have enabled systematic fixed income approaches to complement traditional fixed income investment approaches, potentially enhancing diversification and custom alpha-driven opportunities.

By: Karishma Kaul Anthony Ross Daniel Tremblay, CFA Leo Landes Orhan Imer
Updated: 12/5/2025
Key Takeaways
  • The rise of data analytics and highly sophisticated quantitative techniques has allowed for advances in systematic fixed income strategies that may complement traditional active and passive bond allocations.
  • Systematic fixed income investing combines the rigor of academic research and technology to apply investment factors in portfolio construction, using large data sets to uncover differentiated sources of alpha for bond investors.
  • Growing trends—such as the proliferation of high-quality market data, the rise of electronic trading, and the availability of alternative datasets, combined with advances in machine learning and cloud-based analytics—are accelerating systematic fixed income investing opportunities.
  • In some cases, systematic fixed income strategies have offered lower correlation of excess returns relative to fundamental approaches, as well as lower volatility of excess returns during periods of market or geopolitical stress.
  • Fidelity’s systematic fixed income team can customize solutions across the global bond market universe—such as core, core-plus, high yield, non-traditional bond, municipal bonds, income or liability-driven objectives, among others.
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