WHAT SHOULD YOU DO IN A BEAR MARKET

Stay Calm

In a bear market it is easy to get frustrated as stock prices plummet to new lows every week. It is important to stay calm and keep faith in the markets and the companies that you hold.

Weed out the dud stocks

Companies which are weak financially and may not be able to survive an economic downturn which often coincides with a bear market should be sold.

Hold tight

Good companies and management often thrive in a bear market. Hold on to those stocks in the portfolio.

Rebalance & Diversify

It is important to regularly rebalance the portfolio in terms of equity and debt allocation and diversify as per sector and market caps.

Growth vs Value

At every downfall add value stocks. Invest in a staggered manner or in 3 equal parts.

Read and Listen

It is important that you read management commentaries and listen to what they are saying during bear markets.

Promoter Holding

Strong promoters increase their stake during bear markets. It is often a good indicator of undervalued stocks.

Dividend Stocks

Companies that give regular dividends are often available at good dividend yields during bear markets. Investors can watchout for these kinds of stocks.

Earnings! Earnings! Earnings!

All said and done markets are a slave of earnings. Track earnings of various companies across sectors. It will act as a good indicator of when the markets will bottom out.

Long Term

Keep a long term horizon. History shows that the seeds of a bull market are always sowed in a bear market.

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