Gold is a better diversifier when bonds are this correlated to stocks

  • 📰 KitcoNewsNOW
  • ⏱ Reading Time:
  • 33 sec. here
  • 2 min. at publisher
  • 📊 Quality Score:
  • News: 17%
  • Publisher: 78%

Belgique Nouvelles Nouvelles

Belgique Dernières Nouvelles,Belgique Actualités

(Kitco News) - Bonds are no longer a very good diversifier as they have become too correlated with equities, making gold and other commodities a superior choice, according to David Dierking, Editor of ETF Focus at TheStreet.

Dierking noted that investors who stuck with the classic 60/40 portfolio over the past couple of years have suffered, as “only a 100/0 portfolio really had a chance at generating positive returns.” And while 5% yields on Treasury bills have looked very attractive recently, long-term Treasury bonds are down 45% from their 2020 peak.

With inflation still a problem, bond market volatility will likely remain high along with yields, so going heavily into Treasuries and cash isn’t the best move, he said, and investors should consider rotating part of their portfolio into gold and other commodities instead. Dierking shows the relative performance of stocks, bonds, gold and commodities over the past 15 years.

To test this, Dierking created three simulated portfolios: Portfolio #1 holds 100% U.S. Stock Market, Portfolio #2 is 80% U.S. Stock Market and 20% U.S. Bond Market, and Portfolio #3 contains 60% U.S. Stock Market, 20% U.S. Bond Market, 10% Gold, and 10% Commodities.

 

Merci pour votre commentaire. Votre commentaire sera publié après examen.
Nous avons résumé cette actualité afin que vous puissiez la lire rapidement. Si l'actualité vous intéresse, vous pouvez lire le texte intégral ici. Lire la suite:

 /  🏆 13. in BE

Belgique Dernières Nouvelles, Belgique Actualités

Similar News:Vous pouvez également lire des articles d'actualité similaires à celui-ci que nous avons collectés auprès d'autres sources d'information.

Miner's Drilldown: Weekly technical analysis of the top 10 gold and mining stocksKitco News' contributed commentary features articles and opinions from some of the top experts in the gold industry.
La source: KitcoNewsNOW - 🏆 13. / 78 Lire la suite »