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October 20, 2023 | Bonds Offer Capital Defence, Equities Do Not

Danielle Park

Portfolio Manager and President of Venable Park Investment Counsel ( Ms Park is a financial analyst, attorney, finance author and regular guest on North American media. She is also the author of the best-selling myth-busting book "Juggling Dynamite: An insider's wisdom on money management, markets and wealth that lasts," and a popular daily financial blog:


Unlike bonds, equities offer no return of principal dates nor contractually prescribed income payments. Contrary to the investment sales hype bombarding us daily, dividend-paying equities are not capital ‘defensive.’ Defensive for whom, we should ask.

From present valuation levels, equities are priced to underperform government bonds by 6.5% annualized over the next ten years (see arrow below, courtesy of John Hussman):

“…the gap in expected returns between equities and bonds has joined the worst levels in history, matched only by extremes in mid-1929 and early-2000.”

Komal Sri-Kumar, Sri-Kumar Global Strategies president, joins ‘Closing Bell: Overtime’ to discuss the impact of the Israel-Hamas war on inflation, what this means for fixed income returns, and more. Here is a direct video link.

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October 20th, 2023

Posted In: Juggling Dynamite

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