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How to invest through a recession

Article by Laith Khalaf, AJ Bell YouInvest Magazine.

The Bank of England is now forecasting a long UK recession, beginning at the end of this end of this year, which is expected to last throughout 2023.

We should also be mindful that we’re facing an unusual recession, where unemployment is expected to remain relatively low, energy prices are expected to remain elevated, and interest rates are continuing to climb, despite the weak economic outlook. As a result, some of the strategies investors might employ, such as investing in value funds, dividend stocks and smaller companies, may run against the grain of the orthodox approach of simply battening down the hatches. But unconventional times call for unconventional methods.

There are also some more familiar strategies investors should consider, especially those with a cautious disposition, such as using multi-asset funds to spread risk.

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