Goldman is embracing the rotational trade as well:
"Sell your Tech Stocks and invest elsewhere" says Goldman Sachs
Yesterday was very painful for diversified 60-40 (equities / bonds) portfolios
Source: Bloomberg
Visualizing the growth of $100, by asset class returns across U.S. equities, bonds, real estate, gold and cash since 1970.
source : visual capitalist
US stocks are expensive. That is true, but it is mainly due to tech.
If you look around you'll notice that areas like the cyclicals (energy, financials, materials, and industrials) are all fairly valued and in some cases outright cheap. Source: Carson Investment Research
The 60/40 portfolio doesn't fit all macro regimes by Alfonso Peccatiello / The macro compass
The 60/40 portfolio (60% equities / 40% bonds) did work great for 3 of the last 4 decades, and that's because the macro regime was one of predictably low growth and inflation, and Central Banks ready to support markets and economies. But are you sure the next 10 years be the same as the last 10 years?
US smallcap stocks now account for less than 4% of the entire US equity market.
They now reflect the same percentage of the market as 1930 before the Great Depression. As AI-hype as spreads, small cap stocks have significantly underperformed large caps. Currently, more than one-third of the Russell 2000 index has negative earnings, down from ~45% in 2020. Small-cap stocks are now hated more than ever. Source: The Kobeissi Letter
We are currently in the corporate buyback blackout period for most of the $SPX.
Since 2000, US corporations have bought back $5.5T of stock. This has amounted to more demand than any other market participant, and it’s not even close. 👇 Source: David Marlin, Goldman Sachs
Top Companies by Revenue - Now vs. 3 Decades Ago
Source: Visual Capitalist thru Win Smart
