Core Insights - The article discusses the Avantis Core Fixed Income ETF (AVIG) as a solution for investors facing uncertainty in interest rates and fixed income allocations in 2026 [1] - AVIG employs a systematic active approach, investing in bonds from both U.S. and non-U.S. issuers, including corporations, governments, and government agencies [1] - The fund charges a low fee of 15 basis points and has demonstrated strong performance, returning 7.9% over the past year compared to the category average of 6.7% [1] Investment Strategy - AVIG focuses on bonds with high expected returns, utilizing an analytical framework that evaluates expected income and capital appreciation [1] - The fund's managers assess bonds based on various metrics such as credit rating, duration, currency, yield, and option-adjusted spreads [1] - AVIG may also invest in credit default swaps and total return swaps as necessary to enhance returns [1] Portfolio Role - AVIG offers active flexibility, allowing it to adapt to market changes, unlike passive core bond funds that must strictly track their indices [1] - This flexibility is crucial in scenarios where passive funds may face challenges, such as early bond calls or defaults, which they cannot quickly replace [1] - For investors seeking improved fixed income performance, AVIG presents an upgrade opportunity over traditional passive core bond allocations [1]