Historically, bonds have acted as a stabilizing force when equity markets are weak. In “normal” times, bond prices will move counter to stock prices, and this has held true throughout history. This is the basis of the underlying principle that diversifying across different asset classes (i.e. stocks, bonds and alternatives) makes sense: when stocks fall, bonds prices tend to rise. This hasn’t happened in 2022 as both stocks and bonds have fallen. It’s looking very much like 2022 will go on record as the worst year ever for bond holders.
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By Charles Marleau CIM® and William Mitchell CIM®
By Charles Marleau CIM® and William Mitchell CIM®
