Definition of Great Rotation

What does the term "Great Rotation" mean? What is meant by the term "Great Rotation"?

The "Great Rotation" refers to the supposed phenomenon of investors pulling money out of bonds and putting them into equities. According to some bulls, the "Great Rotation" could signal the beginning of a long-term bull market in the United States.

Definition of Great Rotation - Financial Dictionary - Stock Markets - IllustrationThe "evidence" for this phenomenon is the near-record amount of money that was pumped into stocks in the first month of 2013. Prior to the first month of 2013, you would have to go back to the frothy days of 2000 to find a time when more money was thrown at stocks.

The thing is - this "evidence" does not necessarily signal the start of a new trend. Sure, the markets performed tremendously well from 2009-2012, but the rush of money into the stock market could simply be signalling a near-term top in the markets.

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