By definition, a bear market
is when the stock market falls for a prolonged period of time, usually by twenty percent or more.
His interpretation of the Dow Theory did a better job of navigating the 2007-2009 bear market
and subsequent bull market than any of the nearly 200 other stock market timing strategies monitored by the Hulbert Financial Digest.
In other words, there were only four cyclical bear markets
in Japan in the 39 years from 1950 to 1989, with the average loss being 41 percent and the average duration being 20 months.
The defense in a bear market
is to build a diverse portfolio of value and growth mutual funds, individual stocks, and bonds, and to keep your cash in a high-yield money market," explains Richmond Heights, California-based financial advisor Joyce Muse-Harris.
In a bull market, the overall trend is up and the opposite is true for a bear market
com, Sadana traces the worst bear markets
of the past century to expose signs of false rallies and help stock market investors avoid establishing long positions in the markets too prematurely before the bear market
Fundamentally, if you are able to interpret the signs and then react quickly enough to spread bet accordingly, a bear market
does not necessarily mean a disastrous loss.
But for an investor who has maintained a properly diversified portfolio, structured for long-term growth, the correct reaction to the bear market
is likely to be none, says Edelman in the report, titled Don't Just Do Something, Stand There
As Zander and fellow presenters pointed out, annuities are the only financial product that can avoid the devastation a bear market
can wreak early in retirement, and that can keep on paying no matter how long the investor lives.
Consider dumping speculative stocks that have underperformed in a bull market because they probably won't do well in a bear market
, Carlson said.
In summary, bear markets
generate and then punish optimism, just as bull markets generate and then punish pessimism.
2 /PRNewswire/ -- The bear market
is over, concluded a panel of investment experts at IMPACT '98, the eighth annual conference for fee-based advisors sponsored by Schwab Institutional, a division of Charles Schwab & Co.