History Shows Staying the Course Is Key to Winning in a Bear Market

Macro
โดย The Motley Fool·Read original
Summary · why it matters

The S&P 500's cyclically adjusted price-to-earnings ratio has reached 41, its highest level since the dot-com bubble and near an all-time high spanning 155 years of data, signaling elevated market valuations. History indicates that such peaks often lead to below-average returns in subsequent years as valuations revert to the mean. Investors can prepare for a potential bear market by owning blue chip companies with strong balance sheets and maintaining cash reserves for flexibility. The most important action, according to the analysis, is to stay the course, as the S&P 500 has always recovered from every prior downturn.

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