Stock Bond Correlation Improving!

Wayne

Active member
Aeromir Expert
We have discussed publically that the Stock and Bond relationship changes dramatically in higher inflation #SPW. Over the last few days, we are seeing an improvement in that relationship. This is one data point showing capital is finally moving from stocks to bonds. It indicates that rates have most likely peaked and bonds might begin to be a viable hedge again (short term).

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Wayne

Active member
Aeromir Expert
Hi @Wayne ,

I already see some recommendations to start accumulating TLT
Peak inflation can turn the market for sure. The portfolio is picking up the bearish pressure on yields as well. Beware of the bear squeeze in equities though, This can blow out bonds. One other headwind is if the dollar begins to slide, bonds will be the last place we would want to be. Dollar down, growth slowing, inflation high = death sentence for bonds... what an opportunity for gold though!
 
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