Unstable Correlations: Commodity / Equity Edition

Anyone with the idea that there is a dependable relationship (correlation) between equities and commodities over time may be taken aback by the following chart.

Source: MarketSci Blog

Seeking stable relationships between asset classes is fool’s gold. There are good reasons for including many different asset classes in your investment universe, but dependable correlations is not one of them.

HT: Abnormal Returns

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>