Earlier this fall fund giant Fidelity announced that the post-crisis migration of spooked investors out of equities and into bonds and cash had pushed fixed income assets to account for more than half of the $1.6 trillion Fidelity manages. What’s happening at Fidelity is symptomatic of a massive national preference for bonds. As Fidelity’s asset allocation research team notes, bond inflows industry wide — funds and ETFs — have outpaced stock inflows 33-1 since the financial crisis began. ($1.1 trillion vs. $33 billion.)
And that’s looking like some pretty crappy timing, according to Fidelity’s AA team. In a recent report: US Equities: Light at the End of the Tunnel, Fidelity makes the case that based on current valuations for stocks and bonds, stocks look like the far better investment. On the plus side for stocks is the fact that the average 12-month PE ratio for the S&P 500 (13.8 when the report was published) is historically below average. Looking at data going back to 1926, the AA team found that when starting from a similar valuation, the S&P 500’s annualized real (inflation-adjusted) return for the next five years was 10%.
Source: Forbes
Related Articles:
- A Roadmap To Build Wealth With Dividend Stocks
- The Good, The Bad and The Ugly of Dividend Stocks
- 12 Blue Chip Dividend Stocks For When the Chips Are Down
- Spanning the World For The Best Dividend Stocks
- My Five Top And Bottom Performing Dividend Stocks
Post Crash, Investors Put $33 in Bonds for Every $1 Into Stocks
Posted by D4L | Wednesday, November 07, 2012 | ArticleLinks | 0 comments »________________________________________________________________
Subscribe to:
Post Comments (Atom)
~
Popular Posts Last 30 Days
-
If you're worried about inflation rearing its ugly head next year, you should probably worry about more likely catastrophes, such as bei...
-
As a relatively new blogger, the one thing that has stood out in my mind is the number of Canadian bloggers in the areas that I am most inte...
-
When a company pays a dividend, it's a good thing for shareholders. When a company consistently pays a dividend every quarter, it's ...
-
If you've been holding back from investing in your future just because you don't have a lot of extra cash to spare, I've got gre...
-
If you are looking for high-yield dividend stocks that can beat the market, you might want to check out these three companies. They all have...
-
If you are here to build a portfolio that thrives in all seasons, consider dividend stocks. They can generate steady returns and provide sta...
-
The company's remarkable consistency and low-risk business model make it a "first-choice investment opportunity," according to...
-
One way to achieve financial freedom is to create passive income, or income that does not depend on your active involvement beyond a certain...
-
Since 1926, dividends have contributed approximately 32% of the total return for the S&P 500, while capital appreciations have contribut...
-
My top financial goal is to eventually become financially independent. The foundation of my strategy is to make investments that produce an ...
0 comments
Post a Comment
Post a Comment
Note: Only a member of this blog may post a comment.