Return and risk of bonds and equities from 1980 to 2020 and from 2020 to 2040

We illustrate our analysis with the situations of the United States and the euro zone. Since the early 1980s, disinflation and expansionary monetary policies have led to declining long-term interest rates and to high bond returns. Going forward, inflation and interest rates are most likely to slowly rise. This leads us to compare the return and risk of bonds and equities from 1980 to 2020 with that which can be expected from 2020 to 2040. We see that in the future, bonds will be dominated by equities as a financial asset, which was not the case from 1980 to 2020. This suggests a major change to the structure of portfolios awaits .