The S&P 500’s Lack of Diversification – S&P 5 vs. S&P 495
The S&P 500’s Lack of Diversification – S&P 5 vs. S&P 495 As this chart hightlights, the S&P 500 is less diversified than you think. Image: Lohman Econometrics
The S&P 500’s Lack of Diversification – S&P 5 vs. S&P 495 As this chart hightlights, the S&P 500 is less diversified than you think. Image: Lohman Econometrics
The Value of Diversification – 60/40 Portfolio vs. S&P 500 This chart shows the return and volatility of a 60/40 portfolio vs. S&P 500. Image: Fidelity Investments
Time, Diversification and the Volatility of Returns This chart shows how the volatility of returns decreases over time (range of equity, bond and blended total return). Picture Source: J.P. Morgan Asset Management
Correlation Across Assets The 1-year rolling correlation remains low between asset classes for diversification. Image: Goldman Sachs Global Investment Research
Cross-Asset Correlation and Global PMI Cross-asset correlations imply there is limited scope for diversification. Image: J.P. Morgan
Correlation of U.S. Bonds to S&P 500 The diversification benefit of bonds could be reduced, as the correlation of U.S. bonds to equities has become less negative. Image: Morgan Stanley Research
Super-Cycles – Commodities, Stocks, and Bonds The importance of asset allocation and diversification: commodities, stocks, and bonds do not necessarily moved together over the long term. Image: Wells Fargo Investment Institute
VIX and MOVE Rolling Correlation Periods of high correlation between safe and risk assets are generally not good for balanced portfolios, because diversification is hard to find. Image: Arbor Research & Trading LLC
VIX and MOVE Correlation Periods of high correlation between VIX and MOVE are not good for balanced portfolios, because diversification is hard to find. Image: Arbor Research & Trading LLC
Annual Performance of Gold and the S&P 500 since 1980 One of the advantages of gold is that it is uncorrelated to the U.S. stock market and provides diversification in a portfolio. Image: The Wall Street Journal