Why Are Equities And Oil So Positively Correlated Since The Financial Crisis?
Rupert Hargreaves2021-05-14T02:30:36-04:00
Positively Correlated - Since the financial crisis, the daily returns of global equities and the WTI oil price have been highly correlated. According to Source, the multi-asset research outfit, since 2009 the average correlation between these assets is around 0.4 compared to an average of around 0.0 during the previous two decades. What’s more, at the height of the financial crisis and throughout 2012 the correlation between daily returns of global equities and WTI moved as high as 0.8. The correlation is currently just over 0.5.
Author
Rupert Hargreaves
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Rupert is a committed value investor and regularly writes and invests following the principles set out by Benjamin Graham. He is the editor and co-owner of Hidden Value Stocks, a quarterly investment newsletter aimed at institutional investors. Rupert owns shares in Berkshire Hathaway.
Rupert holds qualifications from the Chartered Institute For Securities & Investment and the CFA Society of the UK.
Rupert covers everything value investing for ValueWalk
