From “Nasdaq”:

A Federal Reserve forecasting tool puts the odds of a recession at 51.84% in the next 12 months, a rare occurrence since 1960. Expect a sharp decline in the stock market during a recession, with historical data showing an average decrease of 32% in the S&P 500 during past events.

Market timing strategies often lead to missed opportunities and losses. Peter Lynch and Warren Buffett recommend long-term focus over short-term market predictions, citing catastrophic consequences of missing the market’s best days.

Warren Buffett’s Berkshire Hathaway consistently invests in the stock market, even during economic downturns, always finding opportunities. Buffett’s strategy involves buying stocks with economic moats at discounted valuations, utilizing the discounted cash flow model to estimate the fair value of a stock before purchasing shares.

Despite the high probability of a recession, Lynch and Buffett would still recommend buying stocks in 2024, particularly those trading at reasonable prices with economic moats. Any drawdown in the stock market due to a recession should be seen as a buying opportunity, as Buffett believes “the best chance to deploy capital is when things are going down.” Would you invest $1,000 in the S&P 500 Index right now? Although the Federal Reserve’s forecasting tool signals a high probability of a recession in the next year, the Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and S&P 500 Index wasn’t one of them.



Read more: Should You Buy Stocks in 2024 Despite the Greatest Recession Risk in Decades? Take Advice From Warren Buffett and Peter Lynch