Amid growing concerns about a global recession, sellers can be hard-pressed to find buyers in the market. One industry insider blames regulation.
Regulation causes a lack of liquidity by forcing banks to reduce balance sheets; strangles the capital market's ability to provide credit; and leads to shadow banking system, said David Castillo, managing director of sales and trading at Odeon Capital Group.
"It's very difficult right now to find liquidity on many assets in the market, and the difficulty is that the banks are dis-incentivized to participate in the market," he told CNBC's "Power Lunch," on Monday.
His advice for the average investor: look out for liquidity capabilities in the fixed-income markets.