Bond liquidity tops fixed income managers' list of concerns

100% of respondents think Brexit will not happen

Nearly 50% of fixed income fund managers said the lack of corporate bond liquidity is the biggest threat to their sector, according to the latest Aviva Investors multi-manager survey.

The results follow widespread fears throughout the second half of 2015 that bond liquidity will dry up as the US and potentially the UK hike interest rates, alongside tighter banking regulations. Out of the managers surveyed, who manage more than £2trn of fixed income assets, 15% also highlighted the withdrawal of quantitative easing and low absolute yields as further risks to the corporate bond market. Ten questions to ask bond managers about falling liquidity Two thirds of the managers surveyed expected returns from corporate bonds of zero to 3%, while 15% expected negative retur...