Anyone agree or disagree on the followings (1-14) ? Economic Expansion 1) Cash instrument: outperform 2) ST / risk free bond: underperform 3) LT risky bond: outperform (because spread fall) Economic Recession 4) Cash instrument: underperform 5) ST / risk free bond: underperform 6) LT risky bond: outperform (because spread rise) Unexpected Inflation 7) Cash instrument: outperform 8) ST / risk free bond: underperform 9) LT risky bond: underperform Interest rate rise 9) Cash instrument: outperform 10) ST / risk free bond: underperform 11) LT risky bond: underperform So. if the economy is in expansion, with high inflation and high interest rate 12) Cash instrument: outperform 13) ST / risk free bond: underperform 14) LT risky bond: Inconclusive
Sorry typo on economic recession effects, corrected as below Economic Expansion 1) Cash instrument: outperform 2) ST / risk free bond: underperform 3) LT risky bond: outperperform (because spread fall) Economic Recession 4) Cash instrument: underperform 5) ST / risk free bond: outperform 6) LT risky bond: underperform (because spread rise) Unexpected Inflation 7) Cash instrument: outperform 8) ST / risk free bond: underperform 9) LT risky bond: underperform Interest rate rise 9) Cash instrument: outperform 10) ST / risk free bond: underperform 11) LT risky bond: underperform So. if the economy is in expansion, with high inflation and high interest rate 12) Cash instrument: outperform 13) ST / risk free bond: underperform 14) LT risky bond: Inconclusive