Jump to content

Stocks vs. Bonds Allocation


Recommended Posts

I was reading Longleaf's current semi-annual report on stock vs. bond pricing and also re-reading the Intelligent Investor.  Chapter 3 is the section that talks about this.  Once again Jason Zweig (as commentator) is clueless or oblivious to this discussion.  The more I re-read his commetary the less I think it brings to the text (obviuos ommisions and clear "efficient market" index-bias). 


Anyhow, according the text the comparision to earnings or FCF yield to AAA bond yield is pretty high (somewhere between 2 and 3 to 1).  When the ratio was this high in the past 1940s and 1950s, stocks outperformed bonds tremendiously.  In looking at the data from the 1960s it is incredable how low the ratio got as low as 0.72. 



Link to comment
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
  • Create New...