Why Everything in Markets Is Becoming Equity Risk
It’s hard to escape these days, but there are still a few strategies.
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Welcome to the fog of truce. It comes with some potential good news. Maybe the war has peaked, maybe the stock market has bottomed. But we can’t really be sure of either of these things. That’s not how modern geopolitical risk works.
So you still will be wanting to keep your risk levels relatively low and your portfolio diversified. But how? The usual diversifier—bonds—doesn’t work anymore. For the last five years, bond and equity returns have been positively correlated (they move in the same direction).