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Saj

It would be interesting to see how these returns compared to bonds over the same period.

Saj

It would be interesting to see how these returns compared to bonds over the same period.

TechFarm

I've done a similar study myself. Who benefits with a fed rate cut, what style, sector, capitalization outperforms:

TKL

Thanks for the handy chart. Each episode has its own set of circumstances. Which most resembles the present? Perhaps 1995 and 1998

Or, perhaps we are beginning a period more like 1989-92, which is not necessarily a good thing, even though it ended with a roughly 30% gain. Those three years saw the 1990 recession, which left the market wallowing in negative territory a year and a half after the rate cuts began.

There does not seem to be much reason to hope for the wild gains of 1974-76 or 1984-86. The former was set up by the market's preceding loss of nearly 50% from 1973-74. The latter represents the secular shift out of hyperinflation, with attendant declines in bond yields. Nothing so momentous is happening now.

Commentators like Stovall of S&P can tout the average returns after rate cuts, but the average shrinks a lot if the outsized gains of irrelevant, unrepeatable precedents are excluded.

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