Investors looking to take advantage of these turbulent times won’t necessarily benefit by moving their allocations to U.S. Treasurys.
This illustrates that investors looking to take advantage of this turbulent time won't necessarily benefit by moving their allocation to U.S. Treasury bills.in a paper they published in July 2019
:"We find no evidence that inverted yield curves predict stocks will underperform Treasurys for forecast periods of one, two, three and five years." Given that shifting your stock allocation to U.S. Treasurys or cash isn't the best solution, what's an investor to do?While high inflation can negatively impact stocks in the short-run, over longer time frames this relationship breaks down. In fact, the median inflation-adjusted return of U.S. stocks over the two years following periods of high inflation was nearly identical to the two-year return following periods of lower inflation .
Though it may seem like investors panic as economic conditions worsen, the data suggests that skittish investors are typically in the minority. Nevertheless, if you are still feeling a bit worried about markets and macroeconomic uncertainty, I will leave you with some parting words from Jeremy Siegel, a world-renowned expert on the economy and financial markets and professor of finance at the University of Pennsylvania:"Fear has a greater grasp on human action than does the impressive weight of historical evidence."
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