Contributed by: Nicholas Boguth, CFA®, CFP®
In 2022, there were fear-inspiring articles about the yield curve inversion. Two years later, we’re seeing the same kind of articles about the yield curve UN-inversion! It can’t be both…can it?
Let’s look back at the last 50 years of inversions and un-inversions and see if either has been a consistent signal for the stock market*.
*Source: Morningstar Direct. Performance = S&P 500 TR.
*Source: Morningstar Direct. Performance = S&P 500 TR.
Do those results surprise you? On average, returns look BETTER after inversions AND un-inversions. That headline doesn’t grab as much attention as one that provokes fear, though.
It is hard to filter out the noise when it is so prevalent in our daily lives. We listen to the noise but rely heavily on the data when making decisions in our investment process. If you have questions about your portfolio, please don’t hesitate to reach out.
Nicholas Boguth, CFA®, CFP® is a Senior Portfolio Manager and Associate Financial Planner at Center for Financial Planning, Inc.® He performs investment research and assists with the management of client portfolios.
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