In a recent Barron’s article, Bessemer Trust Chief Investment Officer Rebecca Patterson shares insights regarding the economic expansion that has occurred over the last ten years, “seeking to uncover lessons that can help us to anticipate risks and opportunities ahead.”

Here are some highlights:

• Peaks can be further away than you think. “Barring some shock” writes Patterson, “the economy for now doesn’t look at risk of imminent recession, though we continue to believe we are in the later stages of this economic cycle.
• Every economic and equity cycle is different. “While economic trends, investor positioning and valuations are all important inputs when assessing the probability of an equity-market peak, we have to acknowledge that these metrics…are not sufficient to form a view.”
• Emotion is a powerful factor. Patterson argues how greed and fear were significant factors that led to the October 2007 peak and subsequent financial crisis. She suggests guarding against fear as an impetus for exiting the market, saying that Bessemer’s goal is to “slowly de-risk into the peak, so we are less reactionary when the eventual downturn emerges.”