COTW: Regime Change for Stocks & Bonds

COTW: Regime Change for Stocks & Bonds

The chart below can be downloaded here.

 

U.S. stock/bond correlations have recently spiked higher. The culprit, we believe, is inflation & higher rates impacting the duration component of both asset classes simultaneously. Higher inflation in the future could spell the end of a 17-year period of negative correlations for both asset classes.

 

 

 

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