If a Recession Is Coming in 2027, I’m Making This 1 Investing Move Without Any Hesitation

There’s a 28% chance the U.S. could experience its next recession by the end of 2027, according to the latest predictions on Polymarket. U.S. Bank‘s Economic Research Group has also set a 25% chance of a recession occurring within the next 12 months.

Those predictions might seem bullish, but they also suggest that persistent inflation, additional rate hikes, and other macro headwinds could still hurt the U.S. economy and trigger the next recession. If that happens, I’d stick with one simple strategy: buy rather than sell.

Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »

Why should investors buy stocks during a recession?

The S&P 500 (SNPINDEX: ^GSPC) has generated an average annual total return of nearly 11% since its inception in 1957. A $1,000 investment in the S&P 500, with reinvested dividends, would be worth $1.16 million today. That’s about $97,315 in 1957 dollars.

But to achieve that gain, you would have needed to stay invested in the S&P 500 through ten official recessions and 11 bear markets. That’s easier said than done, since the S&P 500 experienced steep peak-to-trough downturns during those bear markets. That includes declines of 49% in 2000-2022, 57% in 2007-2009, 34% in 2020, and 25% in 2022.

At the nadir of each of those declines, many investors sold their stocks. But here’s how much the S&P 500 grew — with reinvested dividends — from those multi-year bottoms.

Data source: YCharts

In each case, investors who bought more stocks as the market crashed fared better than those who retreated. That’s why Warren Buffett famously said: “We simply attempt to be fearful when others are greedy and to be greedy only when others are fearful.”

Even if you had done nothing, you would still have fared better than investors who fled the market. A $1,000 investment in the S&P 500 on the first trading day of 2002 — without any additional investments except for reinvested dividends — would still be worth about $10,580.

Sticking with some top-performing individual stocks would have given you even bigger gains. Here’s how much Apple, Nvidia, and Microsoft outperformed the S&P 500 since its darkest day in Oct. 2002.