- Chart on the Go
What should investors do when established historical relationships between asset classes aren’t working?
- Year to date, 2022 has been a challenge for investors. It’s the first time since 1994 that there’s been a calendar-year period of negative returns for both stocks and bonds.
- This can leave investors scrambling for solutions — traditional asset class hedges aren’t working and established historical relationships between asset classes aren’t holding up.
- It’s important to remember that real world events can impact correlations. Drivers like increased volatility and inflation can change the relationships between different asset classes.
- An active approach can help adjust asset allocation decisions to changing correlation relationships. And it can be essential to successfully navigating this environment.