Asset allocators sell down credit holdings ahead of 'bond catastrophe'

Fears ahead of end of quantitative easing

Beth Brearley
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Managers warn quantitative tightening could see "large swathes" of BBB-rated bonds tumble into the high yield index
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Managers warn quantitative tightening could see "large swathes" of BBB-rated bonds tumble into the high yield index

Asset allocators have warned pitfalls as a result of quantitative tightening (QT) are lurking in bond markets, which have the potential to cause a "bond catastrophe" forcing investors to reduce their credit holdings.

Cautioning investors, Man GLG's Craig Veysey, lead fund manager of the group's Strategic Bond fund, said QT could see "large swathes" of BBB-rated bonds tumble into the high yield index, while chief strategist...

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