Wednesday, 17 March 2010

What to Do in a Down (Bear) Market?

The stock market often falls under the conditions of the so called bull and bear markets. Intelligent investors are well familiar with the conditions of both and know exactly what to do. 

Under a down market you have several options.
  • One of them is to sell immediately in order to minimize your losses.
  • Another option is to let the market work its way through the problem with no action from your side.
  • A third option is to benefit from the stock decline and add some more to your portfolio. But, this should be done only if you don't perceive that there is something wrong with the company that has led to the stock decline.

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