Senior Investment Advisor at Mayberry Investments, Christopher Thomas, says the bond and fixed income market is now outperforming the stock market.
He points to high interest rates, heavy government borrowing and the Bank of Jamaica's liquidity mop up through its certificates of deposit.
Thomas says the ongoing economic slowdown since the COVID-19 pandemic has made stocks a riskier bet, explaining that weaker revenues and profits hurt companies and dividend payments depend on cash flow and board discretion.
By contrast, he says, returns on corporate bonds, government securities and BOJ's certificates of deposit are high, virtually risk-free and predictable. That, he says, is why investors are favouring those instruments over stocks.
The stock market closed at around 376,000 points on Friday. That's 124,000 points below the 500,000 mark it hit just before the pandemic struck in 2020.
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