stocks vs bonds correlation
US stocks (S&P 500) · long Treasuries — 1-year correlation swings -0.54 to +0.57
- -0.07normally
- -0.18in crashes
- -0.54 ~ +0.571-year range
- 2.13positions if held 50/50
The sign flips with the era
The one-year correlation swings from -0.54 to +0.57. Green is the stretches they moved together, red the stretches they moved apart.
So a single long-run average describes this pair badly. Which regime you are in right now matters more than the average.
It holds up in the crash too
-0.07 normally, and still -0.18 over the 5% of weeks when US stocks (S&P 500) fell hardest. That is the rare kind that is still there when it is needed.
Try it on your own portfolio
Opens with these two already entered. Add what you hold and the vs the rest and New columns answer whether to add one more.
Open with US stocks (S&P 500) · long TreasuriesWeekly returns, 611 weeks since 2015, every price converted to USD. “Crashes” means the 5% of weeks US stocks (S&P 500) fell hardest. One sample, one window — not a promise about the future.