Let us break down the first message :
1. You see the market going up
2. You buy 300 shares of stock
3. Market keeps rocketing up
5. This all equals a bull market
Now for the reply
1. You see the market going down
2. You freak out a little
3. So you sell your shares
4. Market keeps going down
5. This all equals a bear market
Now let us piece together the first message; first you are watching the market trend upwards, so to take advantage you buy some more shares, and now other investors think the same way and keep buying as well therefore, rocketing prices in the market. You and your fellow investors keep seeing green and this all equals something investors call a “bull” market. Bull markets thrive on GREED
Now for the reply; first you are watching the market trend downwards and you freak out a little bit as the market continues to show slower growth. You decide to sell some of your shares, just like some other investors do as well, which all equals what the investors call a “bear” market. Bear Markets are driven by FEAR
A bull market is quite simple, it is defined by investors based on optimism and the expectation that economy and the market will continue to grow. This is truly a state of mind and remember how we said stock market is like mean girls? Well obviously rumors play a part in fueling a bull market.
A bear market is quite simple, it is defined by investor based on pessmisim and that the expectation that the economy and the market will continue to decline. This again is truly a state of mind and rumors again paly a part in fueling a bear market.
Note: A downturn of 20% over a two month span from the indexes indicate a bear market.
Now there are strategies for Bull and Bear Markets, that Orca will be realeasing in the next couple weeks, and if you want to learn more of a personalized approach please reach out here.
Regardless we Orca’s never freak out or get too excited we strategize and learn how to seize oppurtunities in both type of markets.