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Shipping Stocks: Navigating the Cycle

Alex Dumortier, CFA
January 4, 2013

Stocks ended the first week of the new year on a high note, with the Dow (INDEX: ^DJI) gaining 0.3%, to cap its best week since December 2011. Not to be outdone, the broader S&P 500 (INDEX: ^GSPC) rose 0.5% today, to close at a five-year high.

This morning's column contained a warning concerning "safe" bonds. Since then, CNBC reported that Goldman Sachs issued a client note that highlights the risk in bonds. Equity strategist Robert Boroujerdi writes:

A reversion of risk premiums to historical averages of 6% nominal rates (3% real rates and 3% inflation) would suggest estimated losses in portfolios with bond dur