Stocks have experienced a remarkable rally recently, with a 16% increase in just three months. This surge has been fueled by the expectation that the Federal Reserve (the Fed) will cut interest rates. But do rate cuts actually benefit the market? In this article, we will explore historical data to assess the impact of interest rate cuts on the stock market and provide insights into the potential consequences for investors with a $1 million stock portfolio. We will also discuss how bonds perform during these periods and why it might be a good time to diversify your investment strategy.
Historical Performance of Stocks During the Fed’s Rate Cuts
Investors often express
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