Wednesday, January 15, 2020

Equities Versus Corporate Bonds

This is a comparison between the earnings yield of the S&P 500 and the yield of BBB rated US corporate bonds (ICE BofAML). This deserves a more full analysis, but I think the key observation would be that bond prices have already moved up in anticipation of a downturn. Unfortunately there doesn't appear to be much opportunities other than cash, if like most analysts you are expecting equities to fall.

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