Thursday, March 22, 2007

The Stock/Bond Ratio



A few weeks ago we saw stocks getting dumped and money moving into bonds, well now we are seeing money moving back into stocks and out of bonds.

Above is a 2 year chart of stocks vs bonds. When this ratio line is rising, stocks are outperforming bonds. As you can see the long term trend is in favor of stocks being a better investment than bonds. Now we are seeing a resumption of this trend as the ratio line is once again rising.

1 comment:

Yaser Anwar said...

Hey Kevin-

You should have superimposed the S&P chart to confirm your bias, oh well, good stuff anyways.

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