Michael Stamos, head of global R&D multi-assets at Allianz Global Investors has provided a different take on showing the correlation across asset through a two-dimensional view. Investors want diversifying assets that are in the green zone and away from the white area. The true diversifying assets are cash and commodities which protect from both stock and bond risk. This was not an issue when bond and stocks were negative correlated, but times have changed. Some may view the green region is over diversification. That level of diversification is a choice that investors must make.
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