The correlation of stocks and gold is volatile. Ongoing alignment/positive correlations after a financial crisis, Covid, energy prices (Ukraine war) would seem to have investors splitting exposure between both - positive correlation. At a later date the positive correlation will flip to being negative, maybe dumping dollars/stocks to buy gold, or dumping gold to buy stocks. The markets just saying its current outlook is that either to be as likely a occurrence as the other.dualstow wrote: ↑Tue Nov 08, 2022 4:02 pmYeah, over the past 12 years that I’ve been paying attention it is too often the case, it seems. Lockstep.Kbg wrote: ↑Tue Nov 08, 2022 1:46 pmOn the downside...bonds, stocks and gold are all moving in lock step. As of late we are getting zilch diversification.
Had to bring in some shade on the little ray of light I introduced. :-)
Flight to safety (US$ - and buying US stocks with those $$$'s) has seen a strong/rising $/stocks. With less fear a out-flight from US$/stocks into 'better value' elsewhere could see gold priced in $ doing well.
But equally US$ and US stocks could continue to do OK.
Best stick with 50/50 stock/gold
Bond interest rates could continue on up, or decline.
Best stick with 50/50 short dated and long dated.
Either way, being half right/half wrong is better than being fully-wrong.
More usually the market decides on directions relatively quickly (months) - such that the counter-balancing tends to be activated sooner rather than later. More recently however the uncertainties have been more persistent (years) during which times you can see the likes of stocks and gold moving up or down in lockstep.