SEI's Erin Garnett recently wrote about The Yield Curve and why it's important to not try to time the market. Read an excerpt below and follow the link to the full article.
According to the San Francisco Fed, every recession in the last 40 years was preceded by a yield-curve inversion; however, we do not necessarily expect all inversions to be associated with immediate market declines. After each of the last five inversions, for example, the S&P 500 Index gained 24.7% and the Bloomberg Barclays U.S. Aggregate Bond Index gained 7.2%, on average, from the point of inversion to the next S&P 500 Index peak return. While the time periods between inversion and S&P 500 Index peaks vary, history shows that investors who sell out of the markets immediately following a yield-curve inversion may miss out on gains.
