Evaluating Fixed Income Securities

Fixed-income investments are particularly well suited to addressing a wide range of economic disparities in our society while filling certain capital gaps—that is, funding needs that have often received insufficient attention from investors.  

Before making any fixed-income investment, we believe all responsible investors should ask two key threshold questions: To whom am I loaning my money and for what purpose? 

For corporate bonds, Domini generally applies the same standards we apply to our evaluation of corporations. 

For other types of bonds, we focus on three key themes:

  • Increasing access to capital for those historically underserved by the mainstream financial community
  • Creating public goods for those most in need
  • Filling capital gaps left by current financial practice

These three themes flow from our belief that healthy economies must be built on a strong foundation of fairness and opportunity for all.

We look to address a broad range of social issues through our fixed-income investments including affordable housing, education, community revitalization, rural economic development, the environment and health care.

Domini selects bonds across a broad range of issues including:

  • Affordable Housing, Foreclosure Prevention, Green Buildings (Government Agency Bonds)
  • Economic Development, Climate Change and Adaptation (Municipals)
  • Climate change, Resource Efficiency, Transparency (Green Bonds)
  • Political Freedom, Corruption, Human Rights Concerns, Nuclear Weapons Leadership (Sovereigns)

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The Domini Impact Bond Fund is not insured and is subject to credit, interest rate, liquidity, and market risks. Investing internationally involves special risks, such as currency fluctuations, social and economic instability, differing securities regulations and accounting standards, limited public information, possible changes in taxation, and periods of illiquidity. Investment return, principal value and yield will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. You may lose money.

This information is provided for educational purposes only, and should not be considered investment advice. The composition of the Funds’ portfolios is subject to change. View the most current list of the Domini Impact Equity FundDomini Impact International Equity Fund and Domini Impact Bond Fund's holdings.

The Domini Impact Bond Fund may hold a substantial portion of its assets in the direct obligations of U.S. government agencies and government-sponsored entities, including Fannie Mae and Freddie Mac, and in the mortgage-backed securities of Government National Mortgage Association (Ginnie Mae), Fannie Mae, and Freddie Mac. Ginnie Mae is a wholly owned government corporation that guarantees privately issued securities backed by pools of mortgages insured by the Federal Housing Administration, the Department of Veterans Affairs, and the Department of Agriculture under the Rural Housing Service Program. Fannie Mae and Freddie Mac are government-chartered corporations whose mandate is to enhance liquidity in the secondary mortgage markets. (Ginnie Maes are guaranteed by the full faith and credit of the U.S. Treasury as to the timely payment of principal and interest. Freddie Macs and Fannie Maes are backed by their respective issuer only, and are not guaranteed or insured by the U.S. government or the U.S. Treasury.)

During periods of rising interest rates, bond funds can lose value. The Domini Impact Bond Fund currently holds a large percentage of its portfolio in mortgage-backed securities. During periods of falling interest rates, mortgage-backed securities may prepay the principal due, which may lower the Fund’s return by causing it to reinvest at lower interest rates. Some of the Domini Impact Bond Fund's community development investments may be unrated and carry greater credit risks than its other investments.

The social, environmental and governance standards applied to the Domini Funds are subject to change without notice, as is Domini’s analysis of any of the issuers named above.

Check the background of DSIL Investment Services LLC and its investment professionals on FINRA's BrokerCheck.

Before investing, consider the Domini Funds’ investment objectives, risks, charges, and expenses. View or order a prospectus. Read it carefully.

The Domini Funds are distributed by DSIL Investment Services LLC (DSILD), Member FINRA. Domini Impact Investments LLC (Domini) is the Funds’ investment manager. The Funds are subadvised by Wellington Management Company LLP. DSILD and Domini are not affiliated with Wellington Management Company LLP.

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