Traders Burned by Stock Losses Are Pouring Billions Into Credit

As equities take more pummeling, more traders are hiding out in credit markets.

They’re finding refuge in top-quality bonds, especially short-term securities. So far this year, global investment-grade credit funds have absorbed almost $70 billion, making it the biggest inflow for this part of the year since EPFR Global started tracking the data in 2017.

“Why would you subject yourself to this very data dependent, binary, weekly equity environment with rates repricing, when you can sleep at night sitting in Treasury bills or short-duration investment-grade credit,” said Charlie McElligott, cross-asset macro strategist at Nomura Securities International.

He offered ...