Everything Changes – Bear markets have always been temporary. And so have bull markets.
Common wisdom suggests that you should buy when stock markets are at their lowest point and sell at their highest.
In reality this is almost impossible to achieve – no one can reliably predict the exact time markets will finish falling or when they will reach their peak. However, history gives us three lessons:
1. Each bear market has been followed by a bull market
 Number of Bear Markets* |
 Number of Bull Markets* |
||
| 9 in Developed Markets | 10 in Emerging Markets | 9 in Developed Markets | 10 in Emerging Markets |
2. Bull markets have lasted more than three times longer than bear markets
|
Average Duration of Bear Markets |
Average Duration of Bull Markets |
||
 in Developed Markets |
 in Emerging Markets |
 in Developed Markets |
 in Emerging Markets |
3. Returns in a bull market were substantially more than losses in a bear market
|
Average Market Decline |
Average Market Increase |
||
|
in Developed Markets -30% |
in Emerging Markets -32% |
in Developed Markets |
in Emerging Markets |
*Data for Emerging Markets from 1990, Data for Developed Markets from 1981
Developed markets represented by the MSCI World Index. Emerging markets represented by the MSCI Emerging Markets Index. Performance in local currency as at 31/12/2017. Past performance is no guarantee of future performance. An index is unmanaged and one cannot invest directly in an index.
By trying to guess exactly when to invest, you may miss out on some falls, but could also miss some potential rises. Missed opportunities like these can take a bite out of returns.
Don't miss out on a market recovery.
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