Columbia Threadneedle's Nangle: Bonds no longer a refuge from volatility

Toby Nangle, head of multi-asset at Columbia Threadneedle, says the team is looking carefully for signs of stability in three places at the "centre of the international financial market vortex".

Equities have corrected meaningfully, providing good entry points for patient long-term investors. Nonetheless, the experience has been unsettling for many market participants, as they had become accustomed to extremely low levels of market volatility, in part as a result of the 'financial repression' caused by QE.  From an asset allocator's perspective, perhaps the most interesting aspect of the sell-off has been the almost complete uselessness of government bonds as a portfolio diversifier. Normally, one would expect to see a 'flight to quality' in times such as these, but this has n...