Bonds usually perform well during a recession. Market volatility will push investors away from equities and into bonds, increasing demand for bonds and therefore their price. What's more, both inflation and interest rates tend to fall during a recession. Lower inflation helps bonds maintain their value, and low interest rates cause bond prices to rise. During the financial crisis of 2008, bonds were the best-performing asset. Bonds also performed extremely well during the dot-com bubble of 2000, returning a whopping 8.44% and 10.25% in 2001 and 2002, respectively, according to the Bloomberg Barclays US Aggregate Bond Index.