Shorting Bulls and Buying Bears

Occasionally there are stocks that will go up in bear markets and stocks that will go down in bull markets, but it’s usually not worth the effort to seek them out. The vast majority of stocks, over 80%, will go with the prevailing market trend. And so should you. It just doesn’t make sense to counter trade the market trend. If you’re worried about a short term pullback, don’t. The use of “stop loss” orders will prevent large losses and reduces the worry factor. In a trend correction, simply cut back on your trading, take a few profits, and build up your stash of cash and use the correction to buy back in at lower levels. An old adage still holds true: “The trend is your friend”.