Securities Glossary What is a bull market and what is a bear market financial management tips tips

Category: Money tips Release Date: 2006-01-19

The so-called "bull market", also known as the bull market, saying that the general bullish market conditions, continuing longer a big bull market. The so-called "bear market", also known as the bear market, saying that the general bearish Quotes. The relatively long duration of the crash in the.

Dow Jones shares, according to the empirical data. Summarized the different bull and bear market characteristics that each bull and bear markets can be divided into three different periods.

The first phase of a bull market. And the third part of the bear market overlap, often the most pessimistic in the midfield has happened. Most investors disheartened right midfield, even if the market is also indifferent to the good news, many people began to throw all of the shares, regardless of cost. Far-sighted investors through the various types of economic indicators and analysis of the situation is expected to midfield is about to change, open eyes and gradually to select better stocks to buy. Gradual emergence of micro-market transactions picked up, after a period of time, many stocks were flat from a huge sell-off in the flow head rational investors. Pick-up in the course of the market in the occasional drop, but every time down low than the previous high, so to attract new investment for all, the entire market has become active at this time, the listed company's operating condition and performance of the company began to improvement in profit to increase the attention of potential investors and further stimulating interest in the city of people who.
Second phase of the bull market. Despite significant improvement in market conditions this time, but the bears of the fallen sharply so that investors reeling. Midfielder emergence of a non-l non-or stand-off situation, but on the whole big city, fundamentally sound, trying to stock up. That period can be maintained for several months rather on more than one: The main result of the psychological, as the last bear market severity of the blow may be.

The third phase of the bull market. After a period of wandering, the stock market turnover is increasing. More and more investors enter the market. Big City, not only will each fall so that investors exit the market, but to attract more investors to join. Market sentiment is strong, full of optimism. In addition, the company has also been heard good news, such as profit more than doubled, mergers and acquisitions and so on. Listed companies also took the opportunity to massive fund raising, or Song Honggu or stock split to attract small and medium investors. At this stage of the end of a very thick atmosphere of market speculation, even though there will also be bad news as speculative hot speculation turned into good news. Trash stocks, popular shares rose substantially, and some sound-quality stocks then it will be ignored. Meanwhile, stocks tears swept through every corner of society, all walks of life, people of all ages who have joined the army stocks. When this reaches a certain extreme, the midfielder will be a turning point.
The first phase of a bear market. The early part of the first dry period is not a bull market segment, often appear in the market, investment climate of the most high case, then be too optimistic about the market, investors wary of the market outlook has not changed. The true market, a variety of good news everywhere. The company's performance and profitability reach unusual heights. During this period many enterprises to accelerate expansion, mergers and acquisitions news reports. While the vast majority of investors crazy obsessed with the stock market rally, a few wise investors and large individual investment funds have begun phasing out of or in the wait and see. Therefore, the market turnover, while very hot, there are already signs of a gradual cooling. Then if the stock price further rise in trading volume can not sync to keep up with live, crash may occur. During this period, when stock prices fall, many people still believe that this decline has only increased in the process of asking notes. In fact, this is the beginning of stocks slump.

Second phase of a bear market. This stage, the stock market, there are signs of trouble, it will trigger a "panic selling" hot market, mostly on the one hand, people who want to buy rather difficult to select and hold back, in a wait and see. The other hand, more people began to rush throws. Shares have fallen sharply increased. Yun-set for credit transactions in the market for BU. Engaging in transactions to buy an empty crack down on speculators suffered more, they tend to melt people to repay money due to the pressure of forced to sell, so the more shares fell more urgent, out of control. After a frenzied sell-off and the stock price plummeted after the fall investors will feel a bit too much. Because listed companies and the economic state of the environment has not yet reached the point where so pessimistic, so the market will rebound and the emergence times larger rebound. This is a medium-term rebound is likely to remain a few weeks or months, the rate of recovery or a rebound is generally one-third of the total decline in the market to two points.

The third phase of a bear market. After a period of medium-term rebound, the economic situation and worsening the prospects of listed companies, company performance decline, financial difficulties. A variety of real to the enemy's bad news has followed, result in a further blow to the confidence of investors. Then the whole atmosphere of pessimism pervades the stock market, stock prices fell sharply following the rebound.

The third period in a bear market, stock prices continued to fall, but the decline did not increase. As these are of poor quality, the stock has been in the first, second and then drop it is almost fall any further possible cases have been small, and then the collapse of market confidence due to decreased stock performance has been good and focused on blue chips and high-quality stocks on the . This phase coincides with the early stage of the first phase of the bull market in line, far-sighted and rational investors would think that this is the best opportunity to absorb, when people buy low-cost high-quality stocks, to be picked up after the big city, get good returns.

In general, the bear market experienced a short time than cattle, only about one-third to one half of the bull market. However, the specific time of each bear market is different, due to differences in market and economic environment, the more people will be the difference. Recalling the 1993 to 1997 period, China's Shanghai and Shenzhen Stock Exchange has experienced a significant price change Change is a full turn by the cattle bear, then bear a cyclical process of transfer of cattle.