Global Economic Intersection
Advertisement
  • Home
  • Economics
  • Finance
  • Politics
  • Investments
    • Invest in Amazon $250
  • Cryptocurrency
    • Best Bitcoin Accounts
    • Bitcoin Robot
      • Quantum AI
      • Bitcoin Era
      • Bitcoin Aussie System
      • Bitcoin Profit
      • Bitcoin Code
      • eKrona Cryptocurrency
      • Bitcoin Up
      • Bitcoin Prime
      • Yuan Pay Group
      • Immediate Profit
      • BitQH
      • Bitcoin Loophole
      • Crypto Boom
      • Bitcoin Treasure
      • Bitcoin Lucro
      • Bitcoin System
      • Oil Profit
      • The News Spy
      • Bitcoin Buyer
      • Bitcoin Inform
      • Immediate Edge
      • Bitcoin Evolution
      • Cryptohopper
      • Ethereum Trader
      • BitQL
      • Quantum Code
      • Bitcoin Revolution
      • British Trade Platform
      • British Bitcoin Profit
    • Bitcoin Reddit
    • Celebrities
      • Dr. Chris Brown Bitcoin
      • Teeka Tiwari Bitcoin
      • Russell Brand Bitcoin
      • Holly Willoughby Bitcoin
No Result
View All Result
  • Home
  • Economics
  • Finance
  • Politics
  • Investments
    • Invest in Amazon $250
  • Cryptocurrency
    • Best Bitcoin Accounts
    • Bitcoin Robot
      • Quantum AI
      • Bitcoin Era
      • Bitcoin Aussie System
      • Bitcoin Profit
      • Bitcoin Code
      • eKrona Cryptocurrency
      • Bitcoin Up
      • Bitcoin Prime
      • Yuan Pay Group
      • Immediate Profit
      • BitQH
      • Bitcoin Loophole
      • Crypto Boom
      • Bitcoin Treasure
      • Bitcoin Lucro
      • Bitcoin System
      • Oil Profit
      • The News Spy
      • Bitcoin Buyer
      • Bitcoin Inform
      • Immediate Edge
      • Bitcoin Evolution
      • Cryptohopper
      • Ethereum Trader
      • BitQL
      • Quantum Code
      • Bitcoin Revolution
      • British Trade Platform
      • British Bitcoin Profit
    • Bitcoin Reddit
    • Celebrities
      • Dr. Chris Brown Bitcoin
      • Teeka Tiwari Bitcoin
      • Russell Brand Bitcoin
      • Holly Willoughby Bitcoin
No Result
View All Result
Global Economic Intersection
No Result
View All Result

Is This a Bear Market?

admin by admin
August 31, 2015
in Uncategorized
0
0
SHARES
7
VIEWS
Share on FacebookShare on Twitter

Article of the Week from Money Morning

by David Zeiler, Associate Editor, Money Morning

Although stocks have recovered somewhat, the six consecutive days of losses have many investors asking, “Is this a bear market?”

In that span, the Dow Jones Industrial Average shed 1,878.74 points, or 10.7%. That technically qualifies as a stock market correction. Bear market territory is considered a drop of 20% or more.

bear market
A chart from French multinational bank Société Générale S.A. (OTCMKTS ADR: SCGLY) says yes, this is a bear market. And very convincingly, too – it actually indicates there’s a 99.7% chance we’re already in a bear market.

The chart was created earlier this year by SocGen’s head of quantitative equity research, Andrew Lapthorne. While the details are proprietary, it uses “macroeconomic and fundamental equity variables.”

That’s a mouthful, but backtesting has shown it’s uncannily accurate. The chart corresponds perfectly to the last three major stock market downturns.

Lapthorne wrote in a note earlier this month:

“When you view the U.S. equity market through the prism of investment-style performance. You can see that investors are positioning themselves exactly as you would expect if faced with an economic deceleration.”

This week, SocGen’s global strategist, Albert Edwards, pointed to Lapthorne’s chart as he made his case that this is a bear market.

Edwards wrote in an Aug. 27 note to clients:

“Most investors only realize the economy is in a recession well after it has begun. The same is true of an equity bear market.”

Money Morning Capital Wave Strategist Shah Gilani said the prospect of a bear market, while distressing for many, does serve a purpose.

Gilani said:

“What the markets need is a good, long flushing-out. They need to squeeze out excesses built into artificially inflated equity prices and bond prices.”

That’s good – as the SocGen chart isn’t the only evidence telling us this is a bear market…

Is This a Bear Market? It’s Starting to Look That Way

  • The bull market that started in 2009 reached its sixth birthday in March, and became the third-longest in history as of May. The average bull market lasts about four years.
  • The Standard & Poor’s 500 Index formed a “death cross” today (Friday). That’s when the 50-day moving average falls below the 200-day moving average. Technical analysts consider it a bearish indicator.
  • The U.S. Federal Reserve is planning to raise interest rates, which will reduce the cheap money that has helped fuel the stock market‘s rise.
  • A China stock market crash and increasingly worrisome signs of weakness in China’s economy have already started to affect emerging economies. It’s true that China’s direct impact on U.S. markets will be slight. But ripples from damaged emerging economies and other major trading partners with China will eventually reach U.S. shores.

While investors can’t be sure if this is a bear market, the increasing probability that we could have one means everyone should be taking precautions.

And that does not mean sitting on the sidelines.

Money Morning Chief Investment Strategist Keith Fitz-Gerald, said:

“Running for cover may feel good in the short term, but doing so is totally counterproductive to building ‘total wealth.'”

Instead, here’s what to do…

How to Thrive in a Bear Market

Fitz-Gerald recommends investors use trailing stops as protection against bear market losses. Trailing stops are calculated as a percentage of the purchase price. If the stock falls below that point, it triggers a sell order.

But a trailing stop will rise as the stock price rises, locking in more of your gains in the event the price reverses.

“Thanks in part to our trailing stop discipline, we have something other investors don’t have – the luxury of calmly, coolly evaluating what’s happening while deliberating our next steps,” Fitz-Gerald said.

And Gilani notes that if it turns out we are in a bear market:

“it’s not too late to take profits, if you still have them. And it’s not too late to hedge against further downside moves, or to make money if stocks have a lot further down to go, which I think they do.”

One way to make money in a bear market, he said, is to invest in inverse exchange-traded funds (ETFs).

Gilani said:

“There’s always a place to make money… always.”.

Two of his top picks are:

  • ProShares Short Dow30 (NYSE Arca: DOG), an inverse ETF that correlates to the Dow Jones Industrial Average. It’s up 6% in the last month.
  • ProShares Short QQQ (NYSE Arca: PSQ), an inverse ETF that tracks the performance of the Nasdaq 100 Index. It’s up 5% since Aug. 18, when the recent downturn started.

Editor’s Note: Kent’s spotted a new pattern set to drive record-making profits in the world’s fastest-growing market. 2 Catalysts About to Hand You the Best Energy Investment of the Decade is yours free of charge along with all of Kent’s Oil and Energy Investor briefings when you click here.

Previous Post

Most Read Articles Last Week (Ending 29 August)

Next Post

What Human Emotions Do We Really Want Of Artificial Intelligence?

Related Posts

Is Avalanche (AVAX) A Good Investment In 2023?
Econ Intersect News

Is Avalanche (AVAX) A Good Investment In 2023?

by John Wanguba
April 2, 2023
Binance, CZ, And 3 Top Crypto Influencers Hit With $1 Billion Lawsuit
Econ Intersect News

Binance, CZ, And 3 Top Crypto Influencers Hit With $1 Billion Lawsuit

by John Wanguba
April 1, 2023
Tax Benefits For Bitcoin Firms In Belarus Extended Up To 2025
Economics

Tax Benefits For Bitcoin Firms In Belarus Extended Up To 2025

by John Wanguba
April 1, 2023
China Loans $240B As Bailout 'Belt And Road' Nations – Study
Economics

China Loans $240B As Bailout ‘Belt And Road’ Nations – Study

by John Wanguba
April 1, 2023
Will Ripple And SEC Settle?
Econ Intersect News

Will Ripple And SEC Settle?

by John Wanguba
April 1, 2023
Next Post

What Human Emotions Do We Really Want Of Artificial Intelligence?

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Browse by Category

  • Business
  • Econ Intersect News
  • Economics
  • Finance
  • Politics
  • Uncategorized

Browse by Tags

adoption altcoins bank banking banks Binance Bitcoin Bitcoin adoption Bitcoin market Bitcoin mining blockchain BTC business China crypto crypto adoption cryptocurrency crypto exchange crypto market crypto regulation decentralized finance DeFi Elon Musk ETH Ethereum Europe finance FTX inflation investment market analysis Metaverse NFT nonfungible tokens oil market price analysis recession regulation Russia stock market technology Tesla the UK the US Twitter

Archives

  • April 2023
  • March 2023
  • February 2023
  • January 2023
  • December 2022
  • November 2022
  • October 2022
  • September 2022
  • August 2022
  • July 2022
  • June 2022
  • May 2022
  • April 2022
  • March 2022
  • February 2022
  • January 2022
  • December 2021
  • November 2021
  • October 2021
  • September 2021
  • August 2021
  • July 2021
  • June 2021
  • May 2021
  • April 2021
  • March 2021
  • February 2021
  • January 2021
  • December 2020
  • November 2020
  • October 2020
  • September 2020
  • August 2020
  • July 2020
  • June 2020
  • May 2020
  • April 2020
  • March 2020
  • February 2020
  • January 2020
  • December 2019
  • November 2019
  • October 2019
  • September 2019
  • August 2019
  • July 2019
  • June 2019
  • May 2019
  • April 2019
  • March 2019
  • February 2019
  • January 2019
  • December 2018
  • November 2018
  • October 2018
  • September 2018
  • August 2018
  • July 2018
  • June 2018
  • May 2018
  • April 2018
  • March 2018
  • February 2018
  • January 2018
  • December 2017
  • November 2017
  • October 2017
  • September 2017
  • August 2017
  • July 2017
  • June 2017
  • May 2017
  • April 2017
  • March 2017
  • February 2017
  • January 2017
  • December 2016
  • November 2016
  • October 2016
  • September 2016
  • August 2016
  • July 2016
  • June 2016
  • May 2016
  • April 2016
  • March 2016
  • February 2016
  • January 2016
  • December 2015
  • November 2015
  • October 2015
  • September 2015
  • August 2015
  • July 2015
  • June 2015
  • May 2015
  • April 2015
  • March 2015
  • February 2015
  • January 2015
  • December 2014
  • November 2014
  • October 2014
  • September 2014
  • August 2014
  • July 2014
  • June 2014
  • May 2014
  • April 2014
  • March 2014
  • February 2014
  • January 2014
  • December 2013
  • November 2013
  • October 2013
  • September 2013
  • August 2013
  • July 2013
  • June 2013
  • May 2013
  • April 2013
  • March 2013
  • February 2013
  • January 2013
  • December 2012
  • November 2012
  • October 2012
  • September 2012
  • August 2012
  • July 2012
  • June 2012
  • May 2012
  • April 2012
  • March 2012
  • February 2012
  • January 2012
  • December 2011
  • November 2011
  • October 2011
  • September 2011
  • August 2011
  • July 2011
  • June 2011
  • May 2011
  • April 2011
  • March 2011
  • February 2011
  • January 2011
  • December 2010
  • August 2010
  • August 2009

Categories

  • Business
  • Econ Intersect News
  • Economics
  • Finance
  • Politics
  • Uncategorized
Global Economic Intersection

After nearly 11 years of 24/7/365 operation, Global Economic Intersection co-founders Steven Hansen and John Lounsbury are retiring. The new owner, a global media company in London, is in the process of completing the set-up of Global Economic Intersection files in their system and publishing platform. The official website ownership transfer took place on 24 August.

Categories

  • Business
  • Econ Intersect News
  • Economics
  • Finance
  • Politics
  • Uncategorized

Recent Posts

  • Is Avalanche (AVAX) A Good Investment In 2023?
  • Binance, CZ, And 3 Top Crypto Influencers Hit With $1 Billion Lawsuit
  • Tax Benefits For Bitcoin Firms In Belarus Extended Up To 2025

© Copyright 2021 EconIntersect - Economic news, analysis and opinion.

No Result
View All Result
  • Home
  • Contact Us
  • Bitcoin Robot
    • Bitcoin Profit
    • Bitcoin Code
    • Quantum AI
    • eKrona Cryptocurrency
    • Bitcoin Up
    • Bitcoin Prime
    • Yuan Pay Group
    • Immediate Profit
    • BitIQ
    • Bitcoin Loophole
    • Crypto Boom
    • Bitcoin Era
    • Bitcoin Treasure
    • Bitcoin Lucro
    • Bitcoin System
    • Oil Profit
    • The News Spy
    • British Bitcoin Profit
    • Bitcoin Trader
  • Bitcoin Reddit

© Copyright 2021 EconIntersect - Economic news, analysis and opinion.

en English
ar Arabicbg Bulgarianda Danishnl Dutchen Englishfi Finnishfr Frenchde Germanel Greekit Italianja Japaneselv Latvianno Norwegianpl Polishpt Portuguesero Romanianes Spanishsv Swedish