Hedge Funds

Credit managers scoff at great rotation bond doomsday

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Views from Pine River, BlueMountain, Cerberus, Brevan Howard and more at the Absolute Return Symposium.


L-R: Kuhn, Smith, Stelzer, moderator Mark Johnson, Stewart, Warren (Photo: Axel Dupeux)

The great rotation to stocks that will crush bond investors is a myth, according to leading credit managers.

Top hedge fund investors largely scoffed at the thesis, which was much repeated at the Absolute Return Symposium, saying that the credit markets still had plenty to offer, including plays in mortgage backed securities, high yield and convertible bonds and options on various defaults.

"People are not selling bonds and buying equities. They are buying bonds and buying equities and selling cash, which is exactly what the Fed