Stocks Against Bonds

Here’s a chart I like to look at periodically. It’s the stock market divided by the long-term bond market (specifically, the Wilshire 5000 Total Return divided by the ML 15+ Bond Index).

I think it’s interesting that despite a very strong stock rally since March 2009, the bond market has held its own. In fact, if you had switched into bonds before the end of March, you’d be outperforming stocks.

I’d expect stocks to slightly outperform bonds over the long haul. Given the strong rally in bonds and their ultra-low yields, I think stocks are the safer place to be right now.

Posted by on August 8th, 2012 at 2:35 pm


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