Chart of the Week 10-5-2022

Damon Walker, AIF | October 05, 2022

A message from Edge Investment Solution's Damon Walker:

Chart of the Week

Yield to Feds

INTEREST RATES

The US 10-year Treasury yield surpassed 3.8% last week, marking the quickest re-rating in daily yields since 2009. Today, only ~20% of S&P 500 companies have dividend yields higher than the US 10-Year Treasury yield. With elevated rate volatility likely to persist, we believe US equity valuations may continue to face near-term pressure, and as such, deriving a greater proportion of returns from cash flows may start to look increasingly attractive.

Source: Bloomberg and Goldman Sachs Asset Management. As of August 31, 2022.