However, O’Connor warned investors against acting in the same way as 2007 by looking to actively increase volatility in the so-called ‘hunt for yield’ and make riskier decisions.
“The similarities with 2007 are equity volatility has gone very, very low, it’s forcing people into leverage and nastier stocks and private sector debt to GDP has hit new highs.
“What was called the hunt for yield was a fundamental problem of 2007 and everybody seems to want yield at the moment.”
A key difference, however, is the absence of the same level of “hubris” present in 2007, with O’Connor believing there is more caution now.
He concluded: “2017 is a bad year to make big bets. Clearly we want to be investing but we should be wary.”
