Not very often, as this chart attempts to show. Notice the correlation plot in the bottom panel - any significant time spent below zero indicates a negative correlation between the price of oil and the S&P 500. This has almost always been during a time of rising oil and a falling stock market over the past ten years of easy monetary policy. The second half of 2006 is an exception, and that did not end so well. For a more comprehensive explanation of the correlation between commodities and stocks, inflation / deflation, and what to look for at inflection points, please see Chip Anderson at Stockcharts.com. |
“We are all agreed that your theory is crazy. The question which divides us is whether it is crazy enough to have a chance of being correct. My own feeling is that it is not crazy enough.” ― Niels Bohr
Click on any chart to engorge it
Click on any chart to engorge it