Corporate bond managers defend sector's prospects

Although corporate bonds are looking expensive at present, credit managers are adamant there is litt...

Although corporate bonds are looking expensive at present, credit managers are adamant there is little evidence of a genuine bubble in the asset class. Ian Fishwick, head of UK fixed income at Credit Suisse, says: 'The term bubble is overused these days. I think of bubbles as situations where the assumptions required to justify the market on any sort of discounted cashflow model are totally unrealistic. Based on this, it would be difficult to argue that the current level of credit spreads relative to Government bonds represents a genuine bubble.' He adds that spreads have contracted ...