Global Multi-Asset Investment Strategist, True Insights

Jeroen Blokland

All-round Multi-Asset investor. Former head of a EUR 5 billion multi-asset fund range. Speaker. Charts & Frameworks. Founder of True Insights, a provider of independent investment research, trade ideas & well-diversified portfolios.
https://true-insights.net/

Global Multi-Asset Investment Strategist

The Weekly Market Monitor – Real Rates = Growth Scare?

US Banks - Cash +USD90bn in Week, CRE  -0.55% YoY, C&I +0.36% YoY, Book Value Growth Dwindles 3 Wks

US - Fed Liquidity Moves USD147bn Lower In Past 3 Weeks, Pace Is Accelerating

The Weekly Market Monitor – Immaculate Disinflation, Spiking Yields, and the Waiting Continues

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True Insights

Our research helps investors build well-diversified multi-asset portfolios and profit from market developments. In addition, our unique and proven Macro – Sentiment – Valuation (MSV) investment framework ensures a consistent flow of new investment opportunities. Together with our market views, these opportunities will be reflected in our live ETF-based Global Multi-Asset Portfolios.

Cross Asset Strategy

<ul>
<li>Using a relatively short data sample, we show that buying bonds when the US 10-year real yield rises above 2% has been an attractive strategy.</li>
<li>Equities underperformed their long-term average once the real yield hit this critical level.</li>
<li>Moreover, the Federal Reserve Target Rate and the real yield tended to drop once the latter crossed the 2% threshold.</li>
</ul>


Using a relatively short data sample, we show that buying bonds when the US 10-year real yield rises above 2% has been an attractive strategy.
Equities underperformed their long-term average once the real yield hit this critical level.
Moreover, the Federal Reserve Target Rate and the real yield tended to drop once the latter crossed the 2% threshold.


PIMCO Active Bond Exchange-Traded Fund (BOND US)

Real Rates Above 2%? Buy Bonds and Sell Equities