Concern about debt repayment is starting again to spread beyond Greece to bigger nations, which could be the "canary in the coal-mine for global risk taking," according to Credit Derivatives Research.
"While headlines focused, rightly so, on the debacle that is Greece, it is much more of a systemic crisis in developed nations than most would like to believe," said CDR chief strategist Tim Backshall in a note highlighting a surge in sovereign risk.
CDR's Government Risk Index jumped almost 40 per cent in the last month, its highest since Feb. 25. The GRI is made up of credit default swaps on seven of the largest sovereign debt issuers: France, Germany, Italy, Japan, Spain, the U.K. and the U.S.A.
At the same time, investors have been putting risk on in other categories - sending stocks higher until just recently, and hunting for more yield even if it means buying into asset classes long thought dead.
"The reach-for-yield-at-all-costs attitude of investors worldwide has reached fever pitch again," Mr. Backshall wrote.