Credit Suisse explores how 122 years of global asset returns can inform today’s inflation-driven regime shift. It challenges the idea that equities hedge inflation and shows both stocks and bonds struggle as inflation rises, while diversification remains useful but less reliable in short-term crises.
Credit Suisse Global Investment Returns Yearbook 2022 Summary Edition
Credit Suisse
Elroy Dimson
Research
50 Pages
Key Takeaways
Equities Long Run Dominance: Global equities delivered 5.3% real annual returns since 1900 versus 2.0% for bonds and 0.7% for bills, consistently outperforming across all 35 markets.
Inflation Hurts Assets: Inflation rose from 0.4% in 2020 to 4.4% in 2021, and both stocks and bonds historically show declining real returns as inflation regimes intensify.
Diversification Still Matters: Multi-asset diversification improves risk-return tradeoffs over 122 years, though correlations spike during crises, reducing short-term protection benefits.
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