--- title: November 26' Monthly Commentary description: Explore the latest insights on the Short Term Bond Fund and Bond Fund as they navigate a challenging market with rising rates, geopolitical tensions, and inflation concerns. image: https://blog.yorktownfunds.com/hubfs/november_26_monthly_commentary.jpg --- [Investor Login](https://secure.ultimusfundsolutions.com/PAWeb/Logins/Login.aspx?planname=api&user=shareholder) [Contact Us](https://www.yorktownfunds.com/contact-us/) [![Yorktown Funds](https://blog.yorktownfunds.com/hs-fs/hubfs/raw_assets/public/Yorktown_Funds_November2022/images/Yorktown-Logo-Dark.png?width=565&height=361&name=Yorktown-Logo-Dark.png "Yorktown Funds")](https://www.yorktownfunds.com/) - [Mutual Funds](https://www.yorktownfunds.com/mutual-funds/) - [Short Term Bond Fund](https://www.yorktownfunds.com/mutual-funds/short-term-bond-fund/) - [Bond Fund](https://www.yorktownfunds.com/mutual-funds/bond-fund/) - [Growth Fund](https://www.yorktownfunds.com/mutual-funds/growth-fund/) - [Small Cap Fund](https://www.yorktownfunds.com/mutual-funds/small-cap-fund/) - Advisor Resources - [Forms & Applications](https://www.yorktownfunds.com/forms-applications/) - [All Fund Literature](https://www.yorktownfunds.com/all-fund-literature/) - [About Us](https://www.yorktownfunds.com/about-us/) - [About the Firm](https://www.yorktownfunds.com/about-us/#about-the-firm) - [Investment Process](https://www.yorktownfunds.com/about-us/#investment-process) - [Team](https://www.yorktownfunds.com/about-us/#team) - Insights - [Market Insights](https://blog.yorktownfunds.com/insights) - [Mutual Funds](https://www.yorktownfunds.com/mutual-funds/) - [Short Term Bond Fund](https://www.yorktownfunds.com/mutual-funds/short-term-bond-fund/) - [Bond Fund](https://www.yorktownfunds.com/mutual-funds/bond-fund/) - [Growth Fund](https://www.yorktownfunds.com/mutual-funds/growth-fund/) - [Small Cap Fund](https://www.yorktownfunds.com/mutual-funds/small-cap-fund/) - Advisor Resources - [Forms & Applications](https://www.yorktownfunds.com/forms-applications/) - [All Fund Literature](https://www.yorktownfunds.com/all-fund-literature/) - [About Us](https://www.yorktownfunds.com/about-us/) - [About the Firm](https://www.yorktownfunds.com/about-us/#about-the-firm) - [Investment Process](https://www.yorktownfunds.com/about-us/#investment-process) - [Team](https://www.yorktownfunds.com/about-us/#team) - Insights - [Market Insights](https://blog.yorktownfunds.com/insights) ![](https://blog.yorktownfunds.com/hubfs/november_26_monthly_commentary.jpg) [Short Term Bond Fund](https://blog.yorktownfunds.com/insights/tag/short-term-bond-fund), [Bond Fund](https://blog.yorktownfunds.com/insights/tag/bond-fund) # November 26' Monthly Commentary [Back to Market Insights](https://blog.yorktownfunds.com/insights) ## Short Term Bond Fund Treasury yields rallied roughly 30 to 35 basis points across the curve in October, partially reversing September’s severe selloff. The move was driven in part by a sharp repricing in the technology sector amid growing concerns about AI investment valuations and the sustainability of the buildout at current financing costs. Chair Warsh acknowledged that interest rates “get in all the cracks” and that AI-related capital spending is not immune to monetary policy. The rate rally was broad-based, with both the front end and the long end declining by similar magnitudes and the curve modestly flatter on the month. The Federal Reserve held the fed funds rate at 3.75-4.00% at its October meeting in a 10-2 decision. Governor Cook was a surprise dissent alongside the hawkish President Hammack, both favoring an increase. The statement upgraded its characterization of economic activity from “solid” to “strong” and repeated the Committee’s commitment to deliver price stability. Chair Warsh said he was “unwilling” to characterize financial conditions as tight and stated there was “no lack of clarity” in the Fed’s purpose. He signaled that the intermeeting period would provide additional information to assess the appropriate stance, language widely interpreted as pointing toward a December hike. Inflation showed no signs of retreating to target. The September CPI was firmer than expected, with core prices rising 0.3% and the annual rate climbing to 2.6%. Services excluding energy and rents rose 0.4%, with visible energy passthrough in transportation categories including airfares and delivery services. The PPI was also stronger than anticipated. September core PCE came in at 0.3%, leaving the twelve-month rate at 3.1%. Third-quarter GDP growth was reported at 3.4%, well above expectations, led by 3.8% consumer spending growth and a 12.7% surge in business investment tied to the AI buildout. The September employment report was softer, with payrolls rising only 29,000 and prior months revised down by 60,000, though the unemployment rate edged up to only 4.2% as labor force participation rebounded. Despite the rate rally, credit spreads widened, reflecting a repricing of risk appetite. Investment grade spreads moved modestly wider and agency MBS spreads were roughly unchanged. Oil prices rose 14% as the Iran conflict continued, with no meaningful progress toward resolution. In Short Term Bond Fund, we maintained high-quality positioning throughout the month. The rate rally provided some relief after September’s selloff, and we took the opportunity to trim duration modestly. Liquidity remains robust. The strength of the economic data and the persistence of above-target inflation both point toward further tightening in December, and we continue to emphasize capital preservation and flexibility in an environment where the direction of policy is clear even if the pace remains uncertain. ## Bond Fund October brought a significant rally in Treasuries, with yields declining roughly 30 to 35 basis points across the curve, partially unwinding the extreme selloff of the prior month. A sharp correction in technology-related assets amid mounting concerns about AI investment valuations and financing costs was a primary catalyst, as the repricing of risk assets spilled over into the rate market. Chair Warsh noted that since September, investors have become “more discerning” about AI-related spending and that interest rates affect all sectors of the economy. The curve flattened modestly, with similar declines at the front and long end. The Federal Reserve held rates at 3.75-4.00% in a 10-2 decision at its October meeting. Governor Cook joined President Hammack in dissenting in favor of a hike, a combination that surprised many observers. The statement upgraded its description of economic activity to “strong” and reiterated the commitment to price stability without providing forward guidance. Chair Warsh described inflation as “too high” and said there was “no lack of clarity” about the Committee’s objective. He declined to characterize financial conditions as tight and noted that additional information in the intermeeting period would inform the next decision, widely read as setting the stage for a December increase. The inflation and growth data reinforced the case for further tightening. September core CPI rose 0.3%, lifting the annual rate to 2.6%, with energy passthrough visible in airfares, delivery services, and public transportation. The PPI was firmer than expected, and September core PCE came in at 0.3% with the twelve-month rate at 3.1%. Third-quarter GDP surged 3.4%, buoyed by resilient consumer spending of 3.8% and a 12.7% increase in business fixed investment driven by the AI infrastructure buildout. September payrolls rose only 29,000 with 60,000 in downward revisions to prior months, though the unemployment rate ticked up to just 4.2% as the labor force expanded. The tension between strong aggregate demand and soft payroll growth continues to complicate the outlook. The rally in rates was not accompanied by an improvement in credit conditions. High yield spreads widened, and investment grade spreads moved modestly wider as well. Energy-related high yield names bucked the trend and tightened despite oil prices rising 14% over the month on continued Iran-related supply concerns. Agency MBS spreads were roughly unchanged. In Yorktown Bond Fund, we used the rate rally to reduce European bank exposure. High yield allocations remain focused on higher-quality names, and we trimmed exposure further given the widening in spreads and growing uncertainty around AI-related credit risk. Investment grade corporate holdings were maintained. Portfolio liquidity is strong. The economic backdrop remains one of above-trend growth and persistent inflation, and with the Fed clearly preparing for another hike in December, we continue to prioritize flexibility and prudent risk management.   [VIEW OUR PERFORMANCE HERE](https://www.yorktownfunds.com/mutual-funds/)   Past Performance is no guarantee of future results. The performance data quoted represents past performance. Current performance may be lower or higher than the performance data quoted above. Past performance is no guarantee of future results. The investment return and principal value of an investment will fluctuate so that investor's shares, when redeemed, may be worth more or less than their original cost. For performance information current to the most recent month-end, please call toll-free  800-544-6060 Sources: Yorktown Management & Research Co., Bloomberg. All estimates use daily fund pricing and Yorktown's standard credit quality evaluation method. [Click to View Prospectus](https://yorktownfunds.com/advisors/fund-documents/)   ***Definition of Terms*** *United States Treasury (UST) - the national treasury of the federal government of the United States where it serves as an executive department. The Treasury manages all of the money coming into the government and paid out by it.* *Asset-Backed Security (ABS) - An asset-backed security is an investment security --a bond or note --which is collateralized by a pool of assets, such as loans, leases, credit card debt, royalties, or receivables.* *Basis Points (bps) - refers to a common unit of measure for interest rates and other percentages in finance. One basis point is equal to 1/100th of 1%, or 0.01%, or 0.0001, and is used to denote the percentage change in a financial instrument.* *High Yield (HY) - high-yield bonds (also called junk bonds) are bonds that pay higher interest rates because they have lower cre dit ratings than investment-grade bonds. High-yield bonds are more likely to default, so they must pay a higher yield than investbonds to compensate investors.* *Investment Grade (IG) - an investment grade is a rating that signifies that a municipal or corporate bond presents a relatively low risk of default.* *The funds are distributed by Ulitmus Distributors, LLC. There is no affiliation between Ultimus Fund Distributors, LLC and the other firms referenced in this material.* *Gross Domestic Product (GDP) - The total value of goods produced and services provided in a country during one year.* *Personal Consumption Expenditures (PCE) - the primary measure of consumer spending on goods and services in the U.S. economy.* *Mortgage-backed securities (MBS): Debt obligations that represent claims to the cash flows from pools of mortgage loans, most commonly on residential property.* The fund itself has not been rated by an independent rating agency. Ratings (other than U.S. Treasury securities or securities issued or backed by U.S. agencies) provided by Nationally Recognized Statistical Rating Organizations (NRSRO's) including Standard & Poor's, Moody's, Fitch, Kroll, Morningstar DBRS, A.M. Best, and Egan-Jones. This breakdown is not an S&P credit rating or an opinion of S&P as to the creditworthiness of such portfolio. This breakdown is provided by Yorktown Management & Research. When calculating the credit quality breakdown, the manager selects the middle rating when three or more rating agencies rate a security. When two agencies rate a security, the higher of the two ratings is used, and one rating is used if that is all that is provided. A rating of BB and below would represent below investment-grade. Ratings apply to the credit worthiness of the issuers of the underlying securities and not the fund or its shares. Ratings may be subject to change. Investing involves risk, including loss of principal. There is no guarantee that this, or any, investment strategy will succeed. Fixed income investments are affected by a number of risks, including fluctuation in interest rates, credit risk, and prepayment risk. In general, as prevailing interest rates rise, fixed income securities prices will fall. Diversification does not ensure a profit or guarantee against loss. 1 Includes Structured Notes, Preferred, and Corporate Bonds not rated by a Nationally Recognized Statistical Rating Organizatio n (NRSRO). 2 Duration measures the sensitivity of the price (the value of principal) of a fixed -income investment to a change in interest rates. Duration is expressed as a number of years. Rising interest rates mean falling bond prices, while declining interest rates mean rising bond prices. Spread duration is the sensitivity of the price of a security to changes in its credit spread. The credit spread is the difference between the yield of a security and the yield of a benchmark rate, such as a cash interest rate or government bond yield. 3 Rating Sensitive, Component, and Step-Up Bonds. 4 Weightings subject to change. ### Subscribe to Insights [Previous November’25 Monthly Commentary](https://blog.yorktownfunds.com/insights/november25-monthly-commentary) [![Yorktown Funds](https://blog.yorktownfunds.com/hs-fs/hubfs/raw_assets/public/Yorktown_Funds_November2022/images/Logo-Horizontal-2-Color-Reversed-2048x345.png?width=2048&height=361&name=Logo-Horizontal-2-Color-Reversed-2048x345.png "Yorktown Funds")](http://3.218.76.184/) Email: [info@yorktownfunds.com](mailto:info@yorktownfunds.com) Phone: [(800) 544-6060](tel:8005446060) © Copyright 2022 Yorktown Management & Research Co. 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The Fund’s prospectus contains this and other information about the Fund, and should be read carefully before investing. You may obtain a current copy of the fund’s prospectus by calling [800-544-6060](tel:18005446060).*** *Past performance is no guarantee of future results. The investment return and principal value of an investment in the Funds will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. There is no guarantee that this, or any, investing strategy will be successful.* *Yorktown Funds are distributed by Ultimus Fund Distributors, LLC (member [FINRA](https://www.finra.org/#/)/[SIPC](https://www.sipc.org/)). Yorktown Funds and Ultimus Fund Distributors, LLC are not affiliated.* *Check the background of Ultimus Fund Distributors, LLC on FINRA’s BrokerCheck: [brokercheck.finra.org](http://brokercheck.finra.org/).* ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "John Tener, CFA", "url" : "https://blog.yorktownfunds.com/insights/author/john-tener-cfa" }, "dateModified" : "2026-11-10T14:45:01.750Z", "datePublished" : "2026-11-10T14:45:01.000Z", "headline" : "November 26' Monthly Commentary", "image" : [ "https://blog.yorktownfunds.com/hubfs/november_26_monthly_commentary.jpg" ], "mainEntityOfPage" : { "@id" : "https://blog.yorktownfunds.com/insights/november-26-monthly-commentary", "@type" : "WebPage" }, "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "https://blog.yorktownfunds.com/hubfs/Logo%20Horizontal%20Full%20Color-1.png" }, "name" : "Yorktown Management & Research Co" } } ```