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WikiJo
Lv 6
WikiJo asked in Business & FinanceInvesting · 1 decade ago

What bear market investments do you make/follow/recommend?

This bull has had its ride; soon the business cycle will follow its natural course & contraction will manifest. What defensive stocks/bonds or other investments appeal to you? What do you do when the bear is growling at the door ?

3 Answers

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  • Anonymous
    1 decade ago
    Favorite Answer

    The bull market has had an extraordinary run, however it would premature to predict its demise yet. Specifically because while the Dow is at an all time high, the forward P/E of the Dow is not anywhere near its all time high. With the anticipation that the Fed will lower interest rates in February, th eDow will most likely continue to rise, as the interest rate drop will only spur higher profits.

    One of the hardest things to do in investing is to time the market. HowEver if you are bent on going bearish, then the best thing to do is to cash out of the market, and invest in corporate (blue chip only) and tax free municipal bonds. They will provide a solid return right now, and if rates are indeed cut to jumpstart the economy, then their face value will increase. You can then sell the bonds, and reinvest in a lowered market.

  • 1 decade ago

    I would recommend to stick with the companies you're familiar with. Don't sell your shares. Expect to buy more in bear market. Accumulating shares during bear market is a very good strategy to get wealthy. If you have some taste for speculation, you can use put options to make profit from falling prices.

  • 1 decade ago

    Market cycles last for years. Before market changes its direction it usually goes through high volatility moving sideways period. Long trend is usually due for correction, but not necessarily for long term period market sentiment change.

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