Corporate bonds are increasingly behaving like stocks, with enhanced liquidity and tech-heavy exposure creating new risks. The phenomenon dubbed 'equitification' describes how corporate debt markets now mirror equity market volatility, particularly in technology sectors. Portfolio trading has made bulk bond transactions easier, but this convenience comes with unintended consequences.

Technology companies now dominate both public and private credit markets, raising concerns about concentration risk. The OECD reports that corporate debt spreads move in lockstep with equity markets, suggesting investors treat bonds more like growth assets than traditional fixed income. Private credit has grown to approximately $2.6 trillion but still represents only 9% of corporate borrowing.

Despite recent anxiety about software exposure and liquidity issues, default rates remain stable at 2.5%. Industry experts argue comparisons to the 2008 financial crisis are overblown, noting private credit's relatively small scale in the broader financial system. The market's evolution reflects a fundamental shift in how investors approach corporate debt, trading traditional safety for potential returns that increasingly resemble equity market behavior.