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The Compound and Friends cover image

Only Tesla and Toyota will Survive

The Compound and Friends

NOTE

The Importance of Stock Correlations in Bull Markets

Not all stocks move in the same direction, especially in different sectors and industries. Stock correlation with the S&P 500 has been declining, indicating a healthy bull market. Low correlation means low volatility and investors focusing on individual companies rather than macro crises. This is extremely bullish, resulting in the VIX being below 15. Volatility declines when stocks move differently, which only happens in bull markets.

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