03.04.2013 - Commodity and Equity returns comparable in the very long run: BofAML
After poor performance in the last few months, some investors have cut back their exposure to commodities and boosted positions in equities. While there are cyclical reasons to support this asset allocation decision, BofAML's most recent work suggests commodity and equity returns are comparable in the very long run. The S&P GSCI TR index only has history going back to 1970, while DJ UBS and MLCX TR indices merely date back to 1990. The Bank built a commodity index going back to 1930 and calculated average returns of 8% with a standard deviation of 11% in the 1930-2013 period, compared to 11% returns and 16% deviation for equities (S&P 500 TR)...............................................Full Article: Source
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