Last time, we talked about a bear market in the Mind Your Money Series. Today, we’ll look at a bull market. Just like with the bear market, if you don’t do a lot of investing or watch a lot of financial news, you might not know what a bull market is. I have made it my job in my 40s to do better understanding where and when and how to invest. This month I spied a million magazine headlines speculating about bear and bull markets so I figured I would take some time to map it out for myself so I understand and can pass that on to my readers too. Today we’ll go over what a bull market is and what it means for you and your money.
What is a Bull Market
A bull market is a fun market. This is the market that’s on its way up. To remember this, think of how a bull uses its horns. It throws it’s head UP. So this market is a market that is steadily climbing. In this type of market, everything is generally doing well. Prices are climbing and investor confidence is also climbing. As the market climbs, investors put in more money. As investors put in more money, the market climbs even higher. You’ll often see a bull market after a bearish market. Again, analysts call this a correction. After prices have been driving far down, people will see the opportunity to pick up quality investments at a discount. Thus begins the upward tick.
What Does it Mean
The bull market means opportunity, especially if you get in on the action as it begins. This upward market trend means that confidence is returning to the market, and prices will be climbing for a bit. This is the time to jump into the fray. Don’t do it willy nilly, though. You’ll need the guidance of a financial professional to help you make the best decisions on what to invest in.
What Should You Do
When the market starts trending up, that’s your time to make money. Speak with an investment professional to figure out how you can best leverage a upward trending market to your advantage. Unlike a bear market, a bull market has a far, far better risk to reward ratio. You don’t need any knowledge of special investment skills. You just need the guidance to purchase stocks that are best suited to the current market trend.
Knowing What a Bull Market is Can Make You Money
A bull market is a fun market. Get some financial advice on the best investments to make, and you should be okay. Just remember, no market is ever completely safe, and there is ALWAYS risk. However the risk to reward is far better than a bear market. Aside from getting professional investment advice, the other thing to remember in a bull market is don’t be greedy. No market trend ever lasts.