DO YOU KNOW
When the stock prices of companies are falling it is called a BEAR MARKET.
It is caused by several factors like rumours, fear, war, poor company performance, speculation, famine, disease and virus (like covid-19), failure of a company meet the predicted performance of analysts, following the crowd, and many other different reasons.
From 1926 to 2017, there have been 8 bear markets. While some lasted for 6 months, the most severe ones stayed for 3 years!
Although it is a difficult and scary period for both speculators (short-term participants) and investors (long-term participants), it also presents opportunities to build wealth over time.
As share prices of many (or most!) companies fall, it gives investors (not speculators!), the privilege to buy shares in undervalued (shares of companies selling below the real worth of their businesses) companies that are successful and growing.
When the stock prices of companies are falling it is called a BEAR MARKET.
It is caused by several factors like rumours, fear, war, poor company performance, speculation, famine, disease and virus (like covid-19), failure of a company meet the predicted performance of analysts, following the crowd, and many other different reasons.
From 1926 to 2017, there have been 8 bear markets. While some lasted for 6 months, the most severe ones stayed for 3 years!
Although it is a difficult and scary period for both speculators (short-term participants) and investors (long-term participants), it also presents opportunities to build wealth over time.
As share prices of many (or most!) companies fall, it gives investors (not speculators!), the privilege to buy shares in undervalued (shares of companies selling below the real worth of their businesses) companies that are successful and growing.
1 comment:
panax vietnamensis Wow, cool post. I'd like to write like this too - taking time and real hard work to make a great article... but I put things off too much and never seem to get started. Thanks though.
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