Risk to bonds as once-positive factors could become negative

A number of the positive factors buoying up the bond market in recent years may well become negative over the coming months, says Peter Lucas, global investment strategist at Ashburton. Lucus says although pension funds have been steadily transferring their money from equities into bonds in order to lessen their liabilities, this may now be about to change. In addition, Japanese investors have in the past been heavy buyers of government bonds but, according to Lucas, this looks set to end as a bottoming out of low volatility in Japan has been persuading them to chase volatility elsewhere....