Knowing where you want to be invested before a recession hits can be a huge advantage. Bain & Company has access to a lot of transaction data and reported the following during the Great Recession:
“Our analysis of around 24,000 transactions between 1996 and 2006 shows that acquisitions completed during and right after the last recession (2001–02) generated almost triple the excess returns of acquisitions made during the preceding boom years.“
According to Bain, 80% of transactions that had successful outcomes also had a clear investment thesis. For transactions that failed it was 40%.