Category: Blog

S&P 500 Sectors’ Relative Performance Sensitivity to Real Rates Financials benefit from higher rates, as profit margins expand. Image: BofA Global Research

MSCI World and World Technology 12-Month Forward Earnings Yield Minus U.S. 10-Year Bond Yield Over the last 4 years, the MSCI World tended to decline when the yield gap was close to 2%. Image: Societe Generale Cross Asset Research

What Bubble? – Mutual Funds and ETF Cumulative Flows into Equities and Bonds Since 2009 Are U.S. equities a long way away from being in bubble territory, as inflows since 2009 have gone into bonds, not equities? Image: Fidelity Investments

U.S. 10-Year Treasury Yield Should investors expect more upside for U.S. 10-year Treasury yields? Image: Alpine Macro

Bubble – U.S. Existing House Price Divided by Median Family Income Are Americans trapped in another housing bubble? Image: Evercore ISI

Returns – G7 + China Free Liquidity and MSCI ACWI (Leading Indicator) Global free liquidity continues to rise. When global free liquidity is above 10%, equity markets tend to perform well: the average next 12-month return is 23.4% with a hit ratio of 100% since 2009. Image: BofA Global Research

Fund Flows – Bond, Equity and Money Market Funds Since the start of the coronavirus pandemic, more money has gone into bonds than stocks. Image: Fidelity Investments

U.S. Dollar – Spot (Rally) Seasonality by Day of the Week The U.S. dollar tends to rally on Mondays since 2000. Image: BofA Global Research

New Retail Investors and Stock Market Selloffs New retail investors are willing to invest more money if there is a stock market selloff of up to -3%. Image: Deutsche Bank Asset Allocation

U.S. 60/40 Portfolio Real Returns and U.S. CPI Inflation Above 3% and Rising 60/40 portfolios tend to suffer when inflation is above 3% and rising. Image: Goldman Sachs Global Investment Research

Outperformance of Procyclical Styles – Current Rotation vs. History Investors are pricing a cyclical recovery. Image: Morgan Stanley Research