The table below shows how the market typically performed prior to, during and after recessions in the past. There are some interesting findings.
- Not all recessions had market crashes. Some recessions even saw market rallies.
- Buying during a recession is a great opportunity as stocks tend to appreciate greatly in the next 5 years.
- During recessions, markets only dropped by 1.5% on average.
Of course this doesn’t take into account certain things such as how expensive the market was in the first place and what bond yields were prior to the recession.