Portfolio resilience is crucial at a time of elevated macro uncertainty.
Raising resilience
Stock-bond correlations in the U.S. and euro area, 2000-2019
Past performance is not a reliable indicator of current or future results.
Source: BlackRock Investment Institute, with data from Refinitiv Datastream, September 2019. Notes: The charts show the correlations between daily percentage moves for stocks and bonds over a rolling one-year period. The dot shows the correlation over the most recent 90 day period. For the United States, we use the MSCI USA index for stocks and the 10-year Treasury for bonds. For the euro area, we use MSCI Europe ex-UK index and the German 10-year bund. Indexes are unmanaged and not subject to fees. It is not possible to invest directly in an index.
Government bonds have played an important role in building portfolio resilience – even at ultra-low yields. In Europe, German bunds are less effective shock absorbers as yields approach their perceived floor.
Market implications
Government bonds play an important role in building portfolio resilience – even at low yield levels.
Meet the authors
Philipp Hildebrand
Vice Chairman
Philipp Hildebrand, Vice Chairman of BlackRock, is a member of the firm's Global Executive Committee.
Jean Boivin
Head of BlackRock Investment Institute
Jean Boivin, PhD, Managing Director, is the Head of the BlackRock Investment Institute (BII).
Wei Li
Global Chief Investment Strategist – BlackRock Investment Institute
Wei Li, Managing Director, is Global Chief Investment Strategist at the BlackRock Investment Institute (BII).
Elga Bartsch
Head of Macro Research
Scott Thiel
Chief Fixed Income Strategist
