Monday, August 1, 2016

Correlation of Crude oil and Stocks is negative

The belief generally on the Street, 'As goes oil prices, so goes stock prices,' that's nonsense. I put out a chart last week over the course of the last 5 or 6 years that showed crude oil prices going down, stock prices going. The correlation is negative not positive. You had a period of about three or four months where they did in fact move in correlation with one and other. On balance over broad periods of time the correlation is negative.