2 Useful Quotes to Help You Cope with Bear Markets

One of my favorite financial podcasts would be Motley Fool Money. (I’m not biased… Really!)

Motley Fool Money is a weekly podcast by my colleagues in the U.S. and the content of the podcast typically involves individual stocks, investing, and the stock market in general.

When there are good lessons or quotes to share which are applicable for Singapore’s context, I rarely hesitate to pass them right along.

With Singapore’s stock market – as represented by the Straits Times Index (SGX: ^STI) – flirting with bear market territory, I’d like to share lessons from one podcast which dealt with how one can cope with bear markets.

1. “Everyone’s an investor when the market is going up”

It’s much easier to hold your shares when prices are going up. But the real investor, the podcast argues, emerges when the share prices of your favorite companies start drifting (at times tunneling) south. In such situations, the common stock market participant may find it hard to hold on to his or her investments and thus sell in haste.

Foolish (with a capital ‘F’) investors, however, may want to consider holding tight to their stocks to wait for a potential recovery (which has happened historically) and at the same time, evaluate potential bargains that may appear during a bear market.

2. “The less you understand about a business, the more emotional you are going to be”

If there is one reason why the common stock market participant finds it hard to hold onto his or her shares, it could be that they did not understand as much as they thought they did about the companies that they were buying. Bear markets have the tendency to punish companies and lay bare all their problems.

But if we understand the value of the business behind the ticker, we may find our strength to hold on to our shares instead.

If you have enjoyed the quotes above, have a listen to the podcast while you go for a jog or when you are mopping the floor. It may be well worth your time spent.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn't own shares in any company mentioned.