Hedge fund managers think that the next bubble is in the the credit markets, according to a new report, mirroring recent warnings from asset managers that liquidity in the European corporate bond market is drying up.

A third of managers said that the next bubble is in credit, making it the largest concern (see chart), according to a report published yesterday from US hedge fund advisory firm Aksia, which collected responses from 168 managers representing about $900bn in assets. Other concerns were developed market rates/US treasuries, 26%, and the Asia/China region, 6%.