Recession threat and investments
Given that signs point to a possible recession, how should I adjust my portfolios to cope with it and not lose principal?
I am a 75 year old widow, small social security check, no pension or annuity – just a fairly large cash position in my Fidelity account.
Also how do you get FDIC insurance thru a brokerage account? Buy CDs and treasuries within the account?
Are the government security based money markets less safe?
Thank you very much.
Terry Says
Whew. Well, if you fear a recession, you reduce your exposure to the stock market. Recessions and bear markets don’t go exactly hand-in-hand, but usually follow each other.
You say you have a large cash position. So if you don’t have exposure to stocks, you’re all set already.
Your “cash position” should be in Fidelity’s government money market fund (SPAXX), where there is hte least risk.
Brokerage firms have SIPC insurance up to $500,000 against fraud (but not losses in the market!).
You’ll be safe there.
