This just in: CEO Chris Shuba in Financial Planning

Let’s talk about yields!

Bond Yields Relatively Attractive, but Does it Matter?

  • The S&P 500 Index dividend yield is currently at 1.67%, while the US 2-year treasury yield is at 4.18%. This marks the largest spread between the two yields since the period from November 15, 2005, to August 13, 2007.
  • When bond yields are higher than stock yields, it suggests that investors are favoring safer investments over riskier ones, indicating a possible economic slowdown or recession.
  • However, it is important to note that in the previous period where the spread was this wide, the S&P 500 Index still performed well, with a 21.6% increase over an almost 2-year timeframe.