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If a Bear Market Is Coming, History Says the Smartest Investors Are All Making This 1 Move Right Now
The Motley Fool • • business
Key Points:
- A bear market is defined as a 20% drop in stock prices and occurs roughly every three and a half years in the U.S., serving as a natural cooling-off period in the economic cycle.
- The last bear market began in June 2022, marking four years without one, and while the timing of the next bear market is unpredictable, history advises against panic selling.
- Experienced investors tend to continue buying during bear markets, utilizing dollar-cost averaging to lower their average share cost and position themselves for gains when markets recover.
- Bear markets typically last around nine and a half months, offering opportunities to acquire high-quality assets at discounted prices before the market rebounds.
- Significant market gains often happen early in a bull market, sometimes before it is widely recognized, rewarding investors who maintain their investments throughout downturns.
