Bond Funds Aren't Always as Conservative as Their Names

I received a semiannual report dated June 30 for ACM Government Securities (GSF Quote) a couple of weeks ago. It's 70% Treasury securities and 30% foreign governments. Conservative? It shows a $93 million derivatives loss -- 14% of assets! And since June 30, the price has lost another dollar.

Also, Dreyfus Investment Grade Bond [which has (DRITX Quote)Intermediate Term and (DSTIX Quote)Short Term portfolios] redefined investment grade as anything above C when I called to complain about performance.

This is professional management? Is this common practice? ...