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Increasingly Popular Equities Outperform Gilts, Says Barclays Capital.

Knight Ridder/Tribune Business News, February, 2004

Daily Mail, London Knight Ridder/Tribune Business News

Feb. 25--Equities are gaining in popularity as gilts fall further out of fashion, says Barclays Capital.

UK shares earned real returns of nearly 17 percent in 2003, reversing three years of decline. Gilts -- the best-performing asset of 2002 -- earned just 1.6 percent. Corporate bonds beat inflation by 6.7 percent.

Equities have been the best investment in the long term. Over 104 years, their real return was more than 5 percent annually. Gilts and cash returned just 1 percent per year. Equities could keep outperforming if inflation flares up again.

Barclays' economists think central bankers' focus on avoiding deflation raises the risk of future price rises. In that...

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