Asset class correlations, rather than the VIX, have recently done a better job warning of...

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dentman1 Comments (7)
 
I am a newby and could you explain briefly what "asset class correlations" are? It sounds like you are constructing correlations on stocks, bonds, cash(?) etc. to develop a percentage? Thanks so very much.
26 Jun 2012, 12:03 PM Reply Like

vdiehl Comments (2)
 
I would like to know what specifc assets and see a chart of performance predictions versus actual outcomes. Thank you very much
26 Jun 2012, 01:09 PM Reply Like

Robert Keyfitz Comments (593)
 
Not clear why the reference to "contrarian." I'd have thought a contrarian buy signal would be some indicator of investor pessimism in the market but how is this related to asset class correlations? By the time correlations get to the mid 90s (if, indeed, they DO get there), market sentiment may already have turned bullish and the strategy will be following the crowd rather than betting against it. That's not to say this is bad advice, just that it's not obviously contrarian.

Interestingly, according to my research (on this site), the time for a contrarian bet has already come and gone. Contrarian investors should be cashing out at this point (after having made money over the past 6 weeks).
27 Jun 2012, 01:09 PM Reply Like