Geopolitical Volatility Tops Fixed Income Risk Outlook

The survey, conducted by Censuswide in late May 2026, reflects a cautious sentiment among 100 wealth managers and financial advisors. Forty-five percent of respondents identified geopolitical friction as their top concern, closely followed by the 44 percent focused on the surge in government bond issuance. Persistent inflation and interest rate fluctuations, which have plagued the sector since early 2026, remain significant hurdles for 42 percent of those polled.

Secondary concerns include the policy divergence between the European Central Bank and the Federal Reserve, flagged by 38 percent of participants, and a looming threat of credit deterioration. Additionally, nearly one-third of professionals expressed anxiety regarding the volume of corporate bond issuance tied to AI-driven capital expenditure.

Despite the pervasive caution, a majority of managers see potential for gain. Fifty-seven percent of those surveyed view new high-quality corporate issuance as a viable path for capturing incremental spread. Furthermore, 55 percent anticipate that sector and issuer divergence will provide the necessary dispersion for active managers to generate alpha. Tom Caddick, managing director at Nedgroup Investments, emphasized that while market conditions remain precarious, a selective, research-driven approach to portfolio construction remains essential for navigating the current volatility.