Published : 18 Apr 2023
One of the best ways to survive the market is to follow the trend. Thus, in a bear market, short selling strategy would prove profitable. Take short positions on stocks, speculating on falling prices, and if the prediction is right, one can buy back the stocks at cheaper rates and pocketing the difference as profit.
As the market turns bearish, the stocks prices falling would start wiping off the gains. The way to would avoid that would be either investing in dividend stocks or defensive stocks, debt instruments or precious metals
As the market enters a bearish phase, to curb the losses with falling prices, it is advisable to book profits at regular intervals.
Bear markets are just part of investing cycle. Investors can buy the stocks that they missed out on during a bull market. The bear market wont last forever and valuable stocks will give a favorable return on investment.
Bear markets give a chance to buy the stocks in one’s portfolio and average out the buying price. Thus, when the market eventually picks up, the investor will have more units and can earn more profits.