Why bear market in 2022

       What exactly does the bear market mean? The stock market index went down below 20% from its peak, that we called a bear market. Everyone noticed that there will be a bull and bear in the logo of the stock market. Anyone thinks about why there will be a bull and bear rather than any animals. There will be a backstory for these images. US found there will be some gold mines in the country at that time in the leisure periods they used to make the fight competition between the bull and bear, from these they implemented the pictures in the logo. Simply if the prices are going up then there will be a climate of optimism surrounding it, called the asset is on the bull market. On the other hand if the prices are going down and it seems most people are pessimistic, that we say an asset in the bear market.

      If another question arises, how long does the bear market last? There will be different theories but broadly speaking, a bear or bull market which lasts longer for 5 years secular and shorter ones exist as cyclical.

Investing in a bear market
      There might be a shock for the new investors which we are already in a bear market. We do that this could happen. On an average the stock market can drop more
than 20% once in 4 years. Can drop more than 30% once in 10 years. On an average bear market lasts for one year. The shortest bear market happened in 2020.

     On an average if the bear market lasts for 1 year the bull market lasts for 5 years. Also if the bull market drops 30% the bear market gains 160% on an average.
       How are we today? in a bear or bull market. In the period of 6 months the S & P 500 Index has come down by 20%. When the market can go down for 33% on average then this 20% is not significant. We should not get nervous about this. If the average bear market is 1 year, we crossed the 6 months then the next 6 months whatever can happen, so we could not fear for this as well. In this period of times the value of the stocks are getting lower, use this time to invest based on our capital, it could bounce back to the bull market.
      How long does the bear market last? There will be now ways to predict it, but we can take historical examples to analyze. Average it will take 13 to 14 months to recover. Every bear
market decline is different.
       From this bear market, how could we take advantage of it?
               First of all we need to change the mindset when it comes to bear markets. It is tough after getting lower for months, most people lose hope and sell all the stocks and stay away from it. Be fearful when others are greedy and be greedy when others are fearful. In this time there will be much better deals
when it comes to the bull market.
                Second, research and identify projects which have more potential to win these bear markets. We need to thoroughly do the fundamental analysis and use this to decide whether to buy the stock or not. The picks and the companies are high qualities and hold them with conviction until something changes.
                Third, deploy our capital strategically, the first thing to do is to decide your portfolio composition like with these bear market picks, a lot of them have smaller market caps. Think of our own risk and try to allocate and spread out your capital into multiple smaller bets that you have selected. You don't want to put all those eggs in one basket. Deploy your capital slowly.
       When we know that if we are in bear markets then we need to decrease the unnecessary expenses and try to increase the investments. We can cut down on entertainment and vacation expenses to invest more. We get this kind of opportunity comes on an average of 5 years.