Category: Quant Insight

Correlations are rising and near long-term levels, suggesting that the reflationary macro theme is reasserting itself. We think it is important to continue to watch rates as they push up against the top end of the current trading range.

The correlation figure measures how each asset return moves in relationship to the broader basket of asset returns listed on the X axis. When correlations are high or rising, it may indicate that economic movements and sentiment are driving the majority of returns, which could potentially make security selection challenging.

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