INVESTOR SERIES
A bear market is defined as a 20% drop from recent highs and it refers to the S&P 500’s performance, which is considered the benchmark indicator for the stock market. Investing during bear markets takes more thoughtful planning and patience.
It’s important to understand the most basic cause of a bear market is investor fear or uncertainty
With both logic and fear in mind below 4 basic rules you can use for investing in a bear market:
- Buy quality; focus on companies with solid balance sheets and competitive advantages.
- Stay-in positions for a longer term; investor underperform the market over the long run.
- Don’t try to time the market. Fact, during bear markets you aren’t going to invest at the bottom.
- Patiently build larger positions; as you will be best able to take advantage of the lower prices.
