Many in the industry have a false sense of security with regard to leverage risk, Maxey warned

Many in the industry have a false sense of security with regard to leverage risk, Maxey warned

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Henry Maxey, chief investment officer at Ruffer, has warned the asset management industry is now the epicentre of risk in the financial system, equivalent to the risk posed by the bank leverage during the 2008 Global Financial Crisis (GFC).

In a note to clients entitled Behind the Illusion of Stability, Maxey said the decade of quantitative easing since the GFC had "distorted behaviour" and facilitated the transfer of risk from the banking...