Manitoba Mining Information

Should you snuggle up with the Bear in the Market

What Bear are we talking about? Well it’s the Bear market. A stage in the stock market where we become more like the conservative Bear rather than a Bull set on making forward movements. A bear market is defined as a drop of 20% or more from a previous high, so many think that the USA influenced markets have entered a stage of adopting the antics of the Bear verus the Bull.

Alexander Green, Chairman of Investment U and Investment Director, of The Oxford Club, States “Although we saw a furious short-term rally late last week, the market entered official bear market territory earlier this month.” Mr. Green also thinks that being Cozy with the bear may prove to be rewarding in the long run. If fact he thinks that investing in a Bear Market is a good thing.

To quote him again

“This is a good thing. Legendary investors understand this. Ordinary investors don’t.

If you haven’t spent much time buying stocks, getting excited about a bear market doesn’t just sound counter-intuitive, it sounds nuts. After all, how can you feel appreciative watching the value of your life-savings grind lower? But try thinking like a chess player, a few moves ahead.

Every stock investor knows that you’re supposed to buy low and sell high. Bull markets give you a chance to sell high. Bear markets give you a chance to buy low.”

Buying stocks in a bear market certainly gives us the opportunity to buy low. Buying a stock low is a good thing as long as it has the potential to go high. Waiting for the day that it goes higher may be a long wait.

However as Mr. Green says “If you want to prosper during the next bull market - the one that will propel the averages to new highs in the years ahead - now is your chance to pick up some bargains.”

There is a great deal of logic and common sense to be found in that kind of thinking. After all when would you be in a better position to buy low and sell high on stocks of companies that can and will weather the storm and survive the Bear?

Let’s look at another quote from Alexander Green, he said “Unfortunately, too many investors are lulled into complacency during bull markets and scared out of their wits in bear markets. So they do just the opposite, buying high and selling low.

Yes, the market has fallen sharply over the past nine months. And it may fall further in the weeks ahead.

Still, this is an enormous opportunity for long-term investors. Too bad most of them don’t see it that way”

As Jason Zweig wrote in last weekend’s Wall Street Journal, “The people who so far this year have yanked $39 billion out of U.S. stock funds, and $6 billion out of exchange-traded stock funds, do not understand this. But if you are still in your saving and investing years, a bear market is a gift from the financial gods - and the longer it lasts, the better off you will be. Instead of running from the bear, you should embrace him.”

I say Snuggle him/her a little and see where it leads.

Investment U Wesite

“Cheers”