The Key to Surviving a Bear Market:
Follow the Market by Shorting or Buying Special Mutual Funds that Trade Short Stocks
Many people who are contemplating becoming involved in the stock market do worry about what will happen when the day comes and they have to face a bear market. They worry about how they will survive a bear market and how they will develop an appropriate investment strategy for such a situation.
Of course, one of the most important aspects of surviving a bear market is to be prepared for such an eventuality. When it comes to the stock market and stock trading, it is important to keep in mind that where there is a bull market, there can be a bear market. In short, you need to develop a sound investment strategy that keeps in sight the reality that bear markets do occur.
In addition to planning on a general basis, you are well served by incorporating certain types of stock investing schemes into your overall investment strategy. Therefore, when it comes to dealing with the effects of a bear market, you are wise to follow the market. One accepted rule of thumb is that you should take advantage of shorting the stocks. By doing so, you will work to alleviate some of the negative effects and consequences of a bear market.
Beyond trading in short stocks, you will also want to take steps to diversify your portfolio a bit more significantly than your would in a bull market. For example, in addition to shorting the stocks, you should take a close look at investing in mutual funds that trade in short stocks as a matter of routine. By becoming involved in these types of mutual funds, you will significantly enhance your ability to survive the bear market with your portfolio management scheme well intact.
In our "Members Only area" we have compiled a list of Mutual Funds that have short selling stocks as their portfolio. Those funds are quite legit and widely used, as another instrument of investment.
Our trading system has strategies that can work in either type of market, and you can see from our results that during the recent bear market from 2000-2001, we have had very good returns on all the strategies used.