It even rose 5 % during
the depths of a bear market in metals back in 2012.
At
the depths of bear markets, both free cash flow yields and funding yields rise considerably, but the FCF yields more so.
You can see that bond returns were modest during these equity bear markets, even though
the depths of those bear markets varied.
In addition, advisors can help keep clients focused on the long - term during periods when clients are tempted to leap to a «faster horse» during bull markets, or abandon their plan altogether at
the depths of bear markets.
Not exact matches
But it is still surprisingly consistent considering these equity
bear markets were
of different durations, different
depths, and all began with bond yields at different levels.
Some would argue, myself included, that bull
markets don't start at the
depths of a
bear, but whatever, let's just go with it for the purposes
of moving past a dead and beaten horse.
The same rule can apply when adding / buying stock in the
depths of a sustained
bear market after a severe equity valuation reduction.
Buffett has some pretty pointed comments about this in relaying his purchase
of Washington Post at the
depths of the 73 - 74
bear market which arguably rivaled the sort
of panic conditions in late 08 / early 09.
The S&P 500 has staged a significant recovery from the
depths of the previous
bear market.
But it is well above trough valuations
of about eight times seen during the
depths of the 1970s
bear market, according to data from UBS.