The proportion of the CFA Society of the U.K. members who view corporate bonds as overvalued is at a record high, show the society's valuations index.
The index, which polls the society's members, found 84% of respondents think the asset class is overvalued. This belief has climbed over five consecutive quarters. The previous quarter, 82% said they believed corporate bonds were overvalued.
In a news release accompanying the data, CFA U.K. said the increase in the proportion of members holding this view "most likely reflects the slight drop in corporate bond yields" since the previous quarter, to 1.56% as of April 20, from 1.66% as of Feb. 8.
Respondents also view government bonds as overvalued, by 82% of members, up from 78%; and developed markets equities, at 69%, up from 68% the previous quarter.
Only emerging markets equities are viewed as showing value, with 41% viewing the asset class as undervalued, and 34% believing it is at fair value.
"A year or so ago, our index suggested that investors were still finding some value in corporate credit even if government bonds were seen as very fully valued," said Will Goodhart, CEO of CFA U.K., in the news release.
"That hasn't been the case for some while, and the most recent results show that investment professionals are less convinced by the attractions of corporate credit than at any stage of the past five years. Few of the main asset classes are currently regarded as offering value, though emerging market equities are still seen as attractive. We're reinforcing the message that others have put out that valuations are high but may remain so and that emerging markets seem to offer relatively better value for the time being," he said in the release.