Fears rise over headlong hunt for yield

Institutional investors are being urged to review the quality of bond issues across the credit spectrum amid fears that the search for yield in this low-rate environment is leading to indiscriminate buying. Valuations have become stretched in certain high-yield bond markets, with spreads having tightened by 50 basis points since last year to 360bp, although they are still some way off 2006-07 levels of 250-300bp, argued panelists at a recent forum. “If asked how I would be manag…