CFM

Institutional investors using private equity for diversification are just “doubling up on their main bet”, according to Capital Fund Management, and true diversification will only come through strategies that have fallen out of favour in the last decade.

The negative correlation between bond and equity returns is taken as scripture in financial markets. But Capital Fund Management (CFM) warns that the times may be changing.   The negative correlation between bond and equity returns is the (relatively) simple idea that when equities go down, bonds go up, allowing bonds to act as a…