兴业证券股份有限公司 兴业证券研究所
Bond Market Investment Strategy
Economic fundamentals will remain strong in the short-term. Improvement on liquidity is losingmomentum. The yield of long-term bonds stopped falling and started trending up with fluctuations.However, many investors don’t expect market downturn and rising volatility in the future. Mostinvestors look to gain more coupon payment by using leverage. As the bond yield is dropping,ample liquidity becomes more important to investors who seek to gain from wider spread.
Considering that policymakers tend to strengthen regulation in financial industry and facilitatedeleveraging, in the future, risk appetite of financial institutions and real financing demand will drop,providing support for bond market growth. However, the current market structure might benegatively affected, especially when the leveraging and risk appetite has rebound. The market hasyet to fully price in financial regulation and deleveraging. Investors need to caution against wideningcredit spread.
We advise investors to control their positioning and be selective about the duration of bonds.Patience is required to wait for ideal investment opportunities to come.
Bond Market Investment Strategy
Economic fundamentals will remain strong in the short-term. Improvement on liquidity is losingmomentum. The yield of long-term bonds stopped falling and started trending up with fluctuations.However, many investors don’t expect market downturn and rising volatility in the future. Mostinvestors look to gain more coupon payment by using leverage. As the bond yield is dropping,ample liquidity becomes more important to investors who seek to gain from wider spread.
Considering that policymakers tend to strengthen regulation in financial industry and facilitatedeleveraging, in the future, risk appetite of financial institutions and real financing demand will drop,providing support for bond market growth. However, the current market structure might benegatively affected, especially when the leveraging and risk appetite has rebound. The market hasyet to fully price in financial regulation and deleveraging. Investors need to caution against wideningcredit spread.
We advise investors to control their positioning and be selective about the duration of bonds.Patience is required to wait for ideal investment opportunities to come.
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