It will be preferable, in the medium and long term, to hold bonds rather than shares – Natixis

In the short term, investors should prefer equities to bonds. The situation will be different in the medium and long term (2025 and beyond), analysts at Natixis report.

A complete change in asset allocation between the short term and the long term

“In the short term (2023-2024), equities are preferable to bonds due to rising long-term interest rates, which hurt bonds, and rising corporate profit margins, which favour equities.”

“But in the medium term (2025 and beyond), the very likely rise in real interest rates (due to high investment needs, central banks’ reaction to structurally higher inflation, increased interest rate volatility) will, on the contrary, be positive for bond investments and negative for equity valuation.”