Credit Derivative Trading Shatters Records on Iran War, AI Fears
With the war still dragging on, there’s no sign markets are through the worst.
Source: US NavyInvestors looking to protect themselves against corporate defaults are helping drive record trading volumes in credit derivatives, as the war in Iran fuels fears of a global recession and artificial intelligence rattles once-safe industries.
Trading volumes for the most active derivatives that protect bundles of high-grade and junk-rated bonds in the US and Europe surged to almost $4.5 trillion in the first quarter of the year, according to DTCC data going back to 2013 compiled by Bloomberg. That’s 36% higher than the previous record set by credit default swap indexes when US President Donald Trump unleashed trade tariffs in April last year.