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Correlation | April 12, 2017

Posted on April 12, 2017

Our Observations: Nearly every asset class has experienced an increase in short-term correlation (22 days), and many have risen above their long-term averages. We think this is proof of how interest rate expectations and inflation are driving near-term returns and why it is important to keep an eye on the trading pattern of interest rates. […]

Volatility | April 7, 2017

Posted on April 7, 2017

Our Observations:  Market volatility is an indicator of financial stress. Low or declining volatility environments may indicate favorable periods for equity investments, whereas rising volatility periods may favor sovereign debt and developed market currency exposure. Currently, near-term volatility (22 days) is below long run (12 months) in nearly every asset class, underscoring what has been […]

Correlation | April 6, 2017

Posted on April 6, 2017

Our Observations: 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. In recent months, we […]