Credit Derivatives Strategist: The ‘retail-isation’ of credit markets

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Credit Derivatives Strategist: The ‘retail-isation’ of credit markets

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Credit Derivatives Strategist

The ‘retail-isation’ of credit markets

FMFs are reshaping credit market technicals 18 June 2026

European households hold almost €1trillion in low‑yielding term deposits, creating a Credit Derivatives Strategy

strong incentive to move into credit that offer higher income. Fixed Maturity Funds Europe

(FMFs) are increasingly positioned as an accessible channel for retail participation,

supporting sustained inflows into credit markets. As a result, FMFs are rising in Ioannis Angelakis

importance for credit market technicals, anchoring demand for higher‑quality beta MLI (UK)

segments. Their yield advantage versus deposits continues to attract inflows, reinforcing +44ioannis.angelakis@bofa.com20 7996 0059

demand for corporate and financial subs and high‑quality BBs. Luis Garrido, CFA

Rates, volatility and the reach for yield ResearchBofASE (France)Analyst

Rates markets are signalling a clear dichotomy: while yields have risen sharply, rates vol +33luis.garrido@bofa.com1 8770 0308

has retraced back to more comfortable levels. This creates a supportive backdrop for risk Richard Thomas

assets, prompting investors to seek high‑quality yield opportunities in credit markets. Research Analyst

BofASE (France)

From spread targeting to yield targeting +33richard2.thomas@bofa.com1 8770 0291

Investor behaviour has shifted meaningfully towards yield‑targeting strategies over Barnaby Martin

recent years. The rise of FMFs and the broader search for income have reinforced this Credit Strategist

MLI (UK)

transition, increasing demand for instruments that offer stable and attractive yields. +44 20 7995 0458

barnaby.martin@bofa.com