By: Dividend Sensei
The latest economic reports are showing the economy deteriorating at faster than expected rate. Here’s how investors can prepare their portfolios for a potential recession.
In December the S&P 500 crashed into its worst correction in 10 years, largely due to fears that a recession was coming in 2019. The Dow and Nasdaq didn’t hold up any better, though all three indexes have rallied hard and strong so far in 2019.
However, the recession risks so many were worried about in December are starting to show up in the data and risks of an economic downturn starting in 2020 are now rising. Let’s take a look at why now is probably a good time to start getting defensive, including three ways you can “recession-proof” your portfolio to protect your hard earned wealth from a possible bear market.
Recession Risks Are Rising
While pinpointing when recessions will start is impossible there are time tested methods we can use to judge the current health and trend of the US economy, which ultimately drives corporate profits and thus share prices.