RT Journal Article SR Electronic T1 Modeling Active Management in the Japanese Bond Market JF The Journal of Fixed Income FD Institutional Investor Journals SP 60 OP 70 DO 10.3905/jfi.2002.319334 VO 12 IS 3 A1 Mary Fjelstad A1 Steven M Fox YR 2002 UL https://pm-research.com/content/12/3/60.abstract AB The authors use a simulation methodology to assess the potential value added and residual risk from active management in the Japanese bond market. They examine the performance potential of taking bets on both credit sectors and interest rates, as well as combination strategies. They compare the results from taking bets of different sizes and skill levels to the returns of actual managers and to simulated U.S. strategies over the same period. Illiquidity in Japanese spread sectors severely limits the opportunity for managers to add value using credit strategies instead of the established broad market benchmark, even at high skill levels.