Equity-Bonds Correlation Tracker
The graph below is automatically updated on a daily basis using Google Spreadsheet combine with Google Finance API #FinTech - Access File here
By Joshua Ausden, Editor, FE Trustnet
Feb 3, 2014
Initial jump into positive territories were related to "Tapering" announcements and expectations of interest rates increases; rates variations anticipations are now stabilized.
A risk-off episode? Transient adjustment or more serious?
Fed Rate Hike Not Seen Til 2016, Cheap Money Fueling Stocks - April 18th, 2015
Equity-bonds correlation has move up from -70% on Feb 5th, 2015 to -17% this week. Increasing likelihood of a rate hike by the Fed this year but also uncertainties about inflation may explain this rapid variation.
#GoldmanSachs : "We do not have much confidence in the inflation outlook" http://ow.ly/LMlUg #inflation #uncertainty
Are you buying top-performing bond funds for the wrong reasons?
High valuations represent a risk both on Equity and Bonds - April 5th, 2015
“We believe that the biggest risk is valuation risk: the risk of loss that is realized when expensive assets revert to fair value. This risk is critically important today as we believe stocks and bonds are expensive globally,” Catherine LeGraw, a member of GMO’s asset allocation team, wrote in a recent white paper.
Are you buying top-performing bond funds for the wrong reasons?
Feb 27, 2014
Bond funds that have been prepared to take on more risk have prospered from a relative point of view recently, but they could be set for tough times ahead in a risk-off environment.By Joshua Ausden, Editor, FE Trustnet
Feb 3, 2014
Initial jump into positive territories were related to "Tapering" announcements and expectations of interest rates increases; rates variations anticipations are now stabilized.
A risk-off episode? Transient adjustment or more serious?
Currencies movements –
Yen, USD, EM currencies(1)
Keeping a clear mind: where are
the international reserves(2)
Safe haven adjustment into US Govies
OECD
was pointing out a stagflation risk(3) (low growth with
inflation pressures) in May
2013 in the lines of
IMF – O. Blanchard (2009) publications(4)
This can be a factor for bonds-equity positive correlation as pointed out by Hasseltoft (2009)(2)
Pressures on oil and other commodities prices are not that high (except US natural gas due to extreme weather conditions in January)
This can be a factor for bonds-equity positive correlation as pointed out by Hasseltoft (2009)(2)
Pressures on oil and other commodities prices are not that high (except US natural gas due to extreme weather conditions in January)
Mid-long
terms are currently (and
again) potential hedging
positions for equity
(1)
Reinout
De
Bock & Irineu
E. Carvalho Filho,
2013.
The Behavior
of Currencies
during
Risk-off
Episodes, IMF Working Papers 13/8, International Monetary Fund.
(4) Blanchard, Olivier (2009). Macroeconomics (5th ed.).
Prentice
Hall. pp. 152, 583, 584, G–9. ISBN 0-13-013306-X.
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