The Valuations Index, which gauges confidence among members of the CFA Society, found that 68 per cent of respondents believe corporate bonds are either overvalued or very overvalued.
This compares to just 34 per cent of respondents citing the same feelings in January 2012.
The CFA UK Valuations Index reveals that government bonds are still seen as the most overvalued asset class, while developed and emerging market equities are still viewed as undervalued.
According to the index, 83 per cent of respondents believe government bonds are looking too expensive for too little cushion, a rise of 11 percentage points from results garnered during the first quarter of 2012.
The so-called safe asset of gold, which has seen some of its shine taken off it in recent weeks as the price dipped during January and February, is nevertheless still considered to be overvalued by some investors.
Twelve months ago, 61 per cent of professional investors thought gold was overvalued, according to the research. Now just 47 per cent hold this view.
While opinions on bonds have shifted significantly in the past 12 months, the proportion of investment professionals viewing equities as over or undervalued has been relatively constant throughout the year.
Will Goodhart, chief executive of CFA UK, said: “When we launched the Valuations Index a year ago, the overwhelming majority of investment professionals viewed both government and corporate bonds as overvalued.
“They are even more certain that is the case today. The increase in those who see corporate bonds as overvalued has been particularly dramatic.
“On the other hand, despite the increase in equity values since our last survey, most respondents continue to believe that equities are undervalued – emerging market equities, in particular.”
Adviser view
David Finan, chartered financial planner for Carlisle-based Jardine Finan Wealth Managers, said: “We are in bubble territory and as soon as interest rates rise, all bond funds will fall in value.
“If we get high inflation – which is likely as a result of quantitative easing – bond funds will be unattractive. We would have high inflation now, if the money had been flowing into circulation. The velocity of circulation causes inflation.
“What has been traditionally a cautious part of a portfolio has become high risk.”
Mr Finan added that investors could look at index-linked corporate or government bond funds, such as the Stratton Street Capital Wealthy Nations Bond fund, which only invests in countries that do not have significant debt, such as Norway, Singapore and Qatar.
