Volatility Volatility in default swaps and bond spreads has collapsed and the spreads themselves are at near historical lows. Flows into corporate bond funds have been unremitting, while systematic traders are “max long the asset class,” according to UBS Group AG. In the Australian context, oversubscription in corporate bond issuance has been at record levels reflecting demand and supply dynamics of income-oriented investments. Total Return Assumptions Instead of spreads, these...