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Reflections #18 - QQQs a long duration asset?

QQQs are usually touted as long duration assets, performing especially well when rates fall.

However, historical correlations tell a slightly different story as the average correlation for QQQs and US10 year yields is positive over the last 15 years (see charts).

2020 and 2022 were classical outliers due to extreme long end rates volatility.

Naming tech stocks long duration asset is thus a misleading as tech has been positively correlated to rates for most of the time and only showed a negative correlation in high rates vol environments or sharply rising front end rates.


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