Market Charts

Well-defined research and talking points guide better client conversations and informed decisions. BMO’s Market Charts can be turned into actionable ideas as you build portfolios and grow your business.

Market Chart - Global Negative Yielding Debt Has Reached Record Highs

08/19/2019

Global Negative Yielding Debt Has Reached Record Highs

As interest rates around the globe have fallen, the total value of bonds with negative yields has surpassed $15.6 Trillion. This represents approximately 28%...

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Market Chart - Fixed Income Returns by Credit Quality

08/12/2019

Fixed income returns by credit quality, first half of 2019

BBB rated bonds have captured both the move lower in rates and a tightening of credit spreads to deliver the highest return of any...

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Market Chart - Countries in Recession

08/05/2019

2018 Saw the Lowest Number of Countries in a Recession Ever

Global economic growth is slowing amid rising trade tensions, but low interest rates coupled with central bank interventions have helped limit economic shocks.  ...

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Market Charts - The Cost of More Income Revisited

07/29/2019

The cost of more income…revisited

Investing in higher yielding sectors may seem appealing, but reaching for extra yield can come with substantial downside...

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Market Chart - Wages are rising meaningfully but broader inflation is not

07/22/2019

Wages are rising meaningfully, but broader inflation is not

Wage growth can drive broader inflation, but has not done so for 25 years. The Fed has typically focused on wage inflation as an...

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Market Chart - Russell 1000 Constituent Valuation Spread

07/15/2019

Russell 1000 Constituent Valuation Spread

Over the past few years, attractively valued companies have underperformed their more expensively valued counterparts. As seen, the difference in valuation between cheap and...

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Market Charts - Bond Market Credit Quality

07/08/2019

Quality of Issuers Declining or More Industrials Issuing?

Prior to the financial crisis, Industrials represented less than 50% of the Bloomberg Barclays Investment Grade Corporate Bond Index. Today, Industrials’ share is above...

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Market Chart - Returns are not symmetrical

07/01/2019

Returns Are Not Symmetrical

It becomes increasingly difficult to break-even on investment following a substantial drawdown, making downside protection an important...

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06/24/2019

The US economic recovery is aging gracefully

Although the U.S. is currently in its 10th year of recovery, the growth rate has been slow compared to prior recovery...

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06/17/2019

Starting yields and the ability to withstand rate increases

With duration being equal, a fixed income security with a higher starting yield means that it can withstand more significant increases in interest rates...

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Market Chart Understanding Risk-Adjusted Returns Image

06/10/2019

Understanding risk-adjusted returns

Historical risk-adjusted returns are one of many important factors to consider when building a portfolio. A primary measure of risk-adjusted returns is the Sharpe...

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Market Chart - Years in which Bloomberg Barclays Agg had Negative Price Return

06/03/2019

Coupon income has had an offsetting effect on negative price movements

Since 1980, the Bloomberg Barclays U.S. Aggregate Index has had 18 years with a negative price return, yet only three of those years had...

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Market Chart - Contribution to Russell 1000 Return by Valuation Decile

05/27/2019

Stocks with the highest valuations have driven returns

Over the past year, the stocks with the highest valuations have contributed the most to the Russell 1000’s overall return. Russell 1000 Index measures...

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Market chart: Net Treasury transactions in 2018

05/20/2019

US Households were the largest Treasury purchasers in 2018

In 2018, US Households were the largest purchasers of Treasury securities, a notable shift in what had historically been dominated by foreign investors following...

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Tax Equivalent Yield Chart

04/26/2019

Taxes matter

Taxes can have a meaningful impact on your investment income. Investing in municipal bonds may help offset some of the Federal tax impact.  ...

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Sequential Risk Chart

04/26/2019

When return streams matter

When investing a lump sum, the sequence of returns are less meaningful than just staying invested. If periodic investments or withdrawals are made, the...

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The Rule of 72 Chart

04/26/2019

The Rule of 72

The Rule of 72 is a financial concept that highlights the powerful force of compound interest. This simple equation can approximate how long it...

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Market Chart - Public Company Profitability

04/22/2019

Public company profitability

For private companies with valuations like AirBnB ($31B), Uber ($76B), and WeWork ($20B) unprofitability is the norm, but for similarly sized public companies losing...

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30+ year bond bull market chart

04/15/2019

The 30+ year bond “bull” market

While interest rates have meaningfully declined since 1980, the overwhelming majority of fixed income returns were attributable to coupon income, not price appreciation. This...

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Percent of active funds that outperformed the benchmark in each category

04/08/2019

Active mutual fund performance — Q1 2019

Strong U.S. equity markets in the first quarter created a tough environment for domestic equity managers. Meanwhile, non-U.S. equity and Intermediate-Term Bond managers fared...

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Market Chart Generating a 5% Yield in Fixed Income

04/01/2019

Generating a 5% yield from fixed income has changed dramatically over time

As interest rates have decreased over the past two decades, generating a 5% yield has required fixed income investors to take on more risk....

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Not all dividend stocks are created equal

03/25/2019

Not all dividend stocks are created equal

Of the top 50 yielding stocks in the S&P 500 Index five years ago, nearly two-thirds (62%) have underperformed the benchmark or are no...

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Market Chart A Second Chance at Downside Protection

03/18/2019

A second chance at downside protection

Investors that lacked downside protection during the 4th quarter are getting a second chance as the S&P 500 and expected volatility recover to pre-4th...

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Market Chart Clean India Initiative

03/11/2019

Clean India Initiative reflects growing middle class in the country

In developing economies, rising incomes and increasing levels of consumer spending fuel long-term growth potential. India, for example, has built 90 million toilets since...

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Relative_China_Exposure_Web

03/04/2019

Trade concerns prompted a sell off for US companies exposed to China last June

U.S. companies with high China exposure started selling off sharply in June, just as the trade rhetoric heated...

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SP500-Trading-Days-chart-Web-v2

02/25/2019

Adding perspective to the return of volatility

Volatility rebounded in Q4 2018 after being relatively muted since 2011.   Related resources Practice Management Lifeboat drill: Prepare your clients for volatility To...

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January-2019-Index-Performance

02/18/2019

January 2019 was the strongest January since 1990 for Russell U.S. style indices

U.S. stocks posted strong returns across the style and size spectrum in January. Russell 1000® Index measures the performance of the large-cap segment of...

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Market-Chart-Currency-Effects-on-International-Equity-Returns

02/11/2019

Currency fluctuations less impactful in the longer-term

Currency fluctuations can have a significant impact on shorter-term international equity returns. However, over longer-term periods, these fluctuations were less...

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Market Chart Unemployment Rate vs S&P 500

02/04/2019

The S&P 500 has historically generated higher returns after periods of high unemployment

Understanding historic forward market returns at various levels of unemployment highlights the market’s tempered expectations going forward. The S&P 500® Index is an unmanaged...

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01/28/2019

U.S. stock divergence in 2018

High GDP estimates last spring caused U.S. stocks to diverge from the rest of the world. As the anticipated pace of GDP growth later...

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Market chart: Consumer debt - the bigger picture

01/21/2019

Consumer debt — the bigger picture

Although total consumer debt has reached all time highs, the ability for households to service their debt is at the strongest level in almost...

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Market-Chart-Performance-of-Active-2018

01/14/2019

Active mutual fund performance by category – 2018

Outside of Small Cap Growth, 2018 was a rough year for active management regardless of asset class.   Related resources Global Investment Forum Global...

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Patience Can Pay Off: S&P 500 Recovery From Notable Drawdowns

01/07/2019

Patience can pay off: S&P 500 recovery from notable drawdowns

Even after the two worst drawdowns in the last 25 years, investors who avoided selling during the downturns would have likely recovered their losses...

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12/17/2018

The longer your time horizon, the greater your potential for positive returns

Since 1970, the S&P 500 has generated positive returns in the majority of rolling time periods.   Related resources U.S. Equities Momentum continues to...

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12/10/2018

Yield Curve Inversion

Generally when markets consider the impact of an inverted yield curve, this is in the context of 2 year vs. 10 year or 5...

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Bonds have offered great diversification when stocks were negative

12/03/2018

Bonds have offered great diversification when stocks were negative

Since 1977, the Bloomberg Barclays U.S. Agg has posted a positive return in each calendar year in which the S&P 500 was negative.  ...

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S&P 500 intra-year declines vs. calendar year total returns

11/26/2018

Selling the downdrafts often proves costly for investors

Despite an average intra-year drawdown of 14%, the S&P 500 has posted positive returns in 32 of the past 38 calendar years.   Related...

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Are you actively managing your passive?

11/19/2018

Are you actively managing your passive?

The proliferation of indices globally calls into question the real value they can add. There are now more than 3.7 million indices globally, yet...

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Varied returns highlight the long-run importance of asset allocation chart final

11/05/2018

Varied returns highlight the long-run importance of asset allocation

The relative performance of different asset classes can vary greatly across historic economic cycles. Performance uncertainty and downside protection underpin the need for both...

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active management has added value in taxable fixed income

10/16/2018

Active management has added value in taxable fixed income

Active managers across many fixed income categories have provided investors with index-beating returns. This is most apparent in the multi-sector bond category, where 89%...

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treasuries outstanding vs funding cost 10 year market chart

09/12/2018

Does Treasury supply matter?

Earlier this year, congress passed a budget projected to expand spending by $300 billion over the two-year deal term. The Treasury, in July, raised...

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08/14/2018

Consumers drive the thesis of emerging market performance

The true potential in emerging market economies occurs when a population moves from low income to the early-stages of middle class. It’s why LGM...

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07/25/2018

Maintaining yield & portfolio insurance

This market chart was originally written by Andrew Osterback, Director and Portfolio Manager, Fixed Income Canada for BMO Global Asset Management (Canada). As we...

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07/17/2018

Municipal bonds can recover quickly

Even after notable market drawdowns of the past two decades, municipal bond investors have historically recovered their losses in less than one year. Examining...

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06/18/2018

The cost of more income

The search for higher yield within various sectors of the fixed income market runs the risk of large drawdowns if things go wrong. Make...

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06/18/2018

Bull market, business as usual

We are currently 9.2 years into the bull market and the S&P 500 has returned 386%. Going back to 1936, the average bull market...

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05/22/2018

Stock market volatility: What is normal?

Heightened volatility served as one of the major talking points for the first quarter of 2018. While February’s 10% drawdown may seem large given...

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05/08/2018

India: Developing with pace

With the help of favorable demographics, India’s economy is expected to continue growing. IMF projections have India becoming the world’s fifth largest economy in...

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05/08/2018

Recovery takes time

Over the past nine years, the S&P 500 has recovered from 10% drawdowns in 54 days on average. However, as of 4/30/2018, it had...

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05/03/2018

Room to run overseas

While global equity markets have been on the rise, the valuations of developed international and emerging market stocks are still below their pre-financial crisis...

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05/01/2018

Global trade is weak relative to historical norms

We have been concerned about the state of world trade for some time. It is a great puller of GDP growth – invariably growing...

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05/01/2018

Not all income is created equally

Proactively seeking income from equities is considered a defensive strategy within the equity asset class, while seeking income from the bond side is often...

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