Stock–Bond

Correlation

Inversions:

Navigating

Inflation-Driven

Market

Shifts

Periods of sustained inflation challenge one of the most trusted foundations of portfolio construction—the negative correlation between equities and bonds. In this whitepaper, Omnigence examines more than seven decades of data to show how elevated inflation can flip that relationship, causing both asset classes to decline in tandem and eroding the diversification that 60/40 investors rely on. By mapping historical regimes and stress-testing cross-asset dynamics, we provide a data-driven framework to help institutional allocators and sophisticated investors rethink portfolio design for an environment where inflation shocks are no longer an exception but a recurring risk.

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