The financial markets goes up and sets record highs and sometimes it goes down and sets record lows. That is the nature of the financial market.
And sometimes, the financial market may need to recover (cool down) from performances that set records highs.
What this means is that sometimes, the bear market situation can be necessary to set things right in the stock market.
The bear market is not an entirely bad situation, and this post is set to expose you to things that are necessary for you to know as an investor, during this period.<\/p>\n\n\n\n\n\n
In a down market, short selling can help investors gain.
This strategy entails borrowing shares, selling them, and then buying them again at a discount.
If the trade does not succeed, it could result in significant losses because this strategy is highly risky.<\/p>\n\n\n\n\n\n
A stock index enters bear territory when its closing price falls by at least 20% from its most recent high due to how market cycles are calculated.
On the flip side, the beginning of a new bull market in a stock index occurs when stock prices increase by 20%. <\/p>\n\n\n\n\n\n