Apiary Fund Blog

Why Are The Markets Called Bearish and Bullish?

[fa icon="calendar"] Sep 7, 2019 6:05:00 AM / by Brigette Dumas

The terms Bearish and Bullish are often the terms used to describe general actions and positions, either of an individual asset or of the market as a whole. Bear and bull markets have been named after how each animal attacks its prey. A bull typically attacks with its horns swiping upwards and a bear attacks with its claws swiping downwards. To give you a better understanding of what bearish and bullish means, I’ll start by saying that a bear market refers to a decline in prices, usually for a few months, in an asset or single security, group of security, or market as a whole. In whole, a bull represents when the market prices are rising.

When you hear the term bear market, it's telling you that the market is in a steady decline of price and when the market is saying it's bullish of a steady uprise of prices. To give you some background of bear and bull terms, bull markets tend to last much longer and tend to have much greater returns than bear markets. Because bear markets are so short and severe, it’s impossible to get in and out consistently. In many cases, by the time people realize they’re in a bear market and they start to get a bit nervous, they’re usually closer to the beginning of a bull market instead. If you’re in a bull market, you should attempt to take advantage of rising prices by buying and then selling later when the prices have reached their peak. During a bull market, you should invest in more equity with a higher probability of making a return.

In a bear market, the chances of loss are greater because the prices are continuously losing value. You are better off short selling or making safer investments such as fixed-income securities. I have learned everything I know about trading through The Apiary Fund, and they stress knowing the difference between bear and bull markets when you are going through the educational phase of the program, so you can set yourself up for the most success in the markets.

 

Topics: Apiary Fund, currency market, market events, bearish, bullish

Brigette Dumas

Written by Brigette Dumas

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