In the USA, the fall in share prices started in the autumn of 2007, several quarters before the recession was confirmed. Correspondingly, there is all reason to believe that the stock market will rise long before we see any improvement in the actual real economy– exactly because share prices will gradually start to reflect the expectations of better times.
The stock market normally turns six to eight months before the economy is reported to be healthy. During these six to eight months, share prices have historically risen by a lot. That indicates that one should buy units in equity funds before everyone agrees that the market is going in the right direction.
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