5-Chart Friday (12/18/20)

By Charlie Bilello

18 Dec 2020

This week’s 5-Chart Friday is sponsored by YCharts. Mention Compound to receive 20% off your subscription when you initially sign up for the service.

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5 charts from the past week that tell an interesting story in markets and investing…

1) Asset Class Returns over the Last 10 Years

These are the returns from major asset classes over the last 10 years…

Data via YCharts

What stands out? What will the next 10 years bring? Read my recent post here.

2) Bonds for the Long Run?

Over the last 20 years, long-term bonds have outperformed stocks (350% vs. 284%).

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How did this happen? Read more here.

3) Pandemic + Recession = Multiple Expansion?

The S&P 500’s P/E ratio has moved from 20.6 at the start of 2020 to 30.8 today, on pace for the highest year-end multiple in history (post).

4) Bitcoin Booming

Bitcoin crossed above $20,000 this week for the first time, and it did not stop there…

The catalyst?

There are many to choose from, including the prospect of another spike higher in US national debt (via another stimulus bill) and the Fed continuing its record balance sheet expansion, with assets hitting a new high of $7.36 trillion.

As confidence in Bitcoin surges higher, the same cannot be said for the US Dollar, which has been moving in the opposite direction.

5) One of These Things Is Not Like the Other

The growing disconnect between the Fed’s continuation of emergency stimulus measures and market conditions…

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And that’s it for this week. Thanks for reading.

Have a great weekend everyone!


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Disclaimer: All information provided is for educational purposes only and does not constitute investment, legal or tax advice, or an offer to buy or sell any security. For our full disclosures, click here.

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