@article {Garveyjoi.2018.1.069, author = {Gerald Garvey and Konark Saxena}, title = {Should the Interest Rate Level Influence Asset Allocation?}, elocation-id = {joi.2018.1.069}, year = {2018}, doi = {10.3905/joi.2018.1.069}, publisher = {Institutional Investor Journals Umbrella}, abstract = {How does the interest rate environment inform the allocation between risky and safe assets? The authors focus on the level rather than change in rates because rates are highly persistent; changes are infrequent and unpredictable while low versus high rate regimes are durable. US history from 1926-2016 shows that equities have lower risk and higher excess returns when rates are low. Despite all the concern about low yield, a low rates environment is actually a good thing for more aggressive investors.}, issn = {1068-0896}, URL = {https://joi.pm-research.com/content/early/2018/05/09/joi.2018.1.069}, eprint = {https://joi.pm-research.com/content/early/2018/05/09/joi.2018.1.069.full.pdf}, journal = {The Journal of Investing} }