'Plethora' of new regulations pose threat to corporate bonds-Loomis

Scott Service, global bond manager at Loomis, Sayles & Company, explains why reduced liquidity for corporate bonds and a 'plethora' of new regulations has forced the team to lower risk levels on portfolios.

After experiencing a very difficult fourth quarter in 2014, as a result of the precipitous fall in oil prices and observed global disinflationary trends, investment grade corporate bonds within major markets have performed well in the first few months of 2015. The European Central Bank's enhanced QE plan announced in January had a positive impact on risk markets. Additionally, given an improving US economy, the yield advantage of corporate bonds versus a shrinking pool of higher quality fixed income assets, the attraction of the asset class is evident. While the situations in Greece a...