Top Nav

Bull Markets

Quite simply, bull bull-marketsmarkets refer to an upward trend in the stock market. The length of that uptrend determines whether it is a secular or cyclical bull market.

A secular bull market is characterized by above average stock market returns by the S&P 500 for a long time, typically 10 to 20 years. Periodic bear markets spring up within a secular bull market until the next cyclical bull market takes over and carries the market to even higher highs. A cyclical bull market refers to one that lasts a few months to a few years.

Many factors can drive bull markets: strong economy, high consumer spending, low unemployment, post-war spending, high stock valuations and earnings, and all-around optimism and certainty.

Bull Market Definition: Why is a Bull a Bull?

  • Consistent rise in stock prices.
  • Healthy economy.
  • Geographic and political certainty.

For example, the U.S. stock market experienced a secular bull market from about 1983 to 2000 (or 2007), with brief upsets including the crash of 1987, and in the market collapse of 2000-2002 triggered by the dot-com bubble.

The technology sector drove the bull market from 1990-2000 and remains one of the longest and strongest ones in U.S. history. It was a time when triple-digit profits from start-up Internet stocks were the norm. Investors actually shied away from steady double-digit index performers (S&P 500, Dow Jones Industrials) to participate in the unprecedented run-up in technology stocks.

The second strongest bull market was brought on by election of Ronald Reagan in 1981, the descent of interest rates and the great bull market in bonds. From 1982 to 1987, the Dow Jones Industrial Index (DJI) gained 250%.

Interestingly, there is a lot of speculation surrounding the current uptrend in the stock market that started in 2009. Some say it is a cyclical bull market and is on the brink of a long-term trend reversal. Others say the last few years have been part of a bear market rally, and we may be coming into a new secular bull market.

Regardless of how it’s labeled, be sure you monitor the trends and performance of your positions. Don’t let emotions dictate what or when you buy or sell. Following the heard, a term referring to a piling up of money in stocks regardless of fundamentals, can be dangerous. When stock markets are wrought with excess and overvaluations, bear markets can often be right around the corner.

Top 3 Stocks In Today’s Overvalued Market

With the market overvalued, some investors are feeling uneasy, while others are simply having a hard time finding stocks worth buying. Luckily, Morningstar has done the heavy lifting for us. They’ve outlined which parts of the market are overvalued and which might still be worth buying.  The investment site notes that large-cap stocks are cheaper [...]

Invest in Distressed Real Estate With These Stocks

You haven’t missed out on buying foreclosed homes. If you’ve ever been at a party, and spoken to some guy who buys distressed real estate, have you ever felt like you missed out on a great opportunity?  I’m sorry to say that, as far as distressed real estate goes, you pretty much missed out unless [...]

Will Health Foods Beat the Market?

Eating healthier is more than just a fad. Indeed, a cultural shift is underway. This shift has created an environment in which a company like McDonald’s (NYSE: MCD) has been put on its heels and forced to play catch up to competitors like Chipotle Mexican Grill (NYSE: CMG) and Panera (Nasdaq: PNRA). But do health [...]

Google and a Trillion Dollar Market Cap

I tend to avoid most investment opinions I hear or read on popular media outlets.  But occasionally something is said that piques my interest. Jim Breyer, founder and CEO of Breyer Capital and a partner in Accel Partners, piqued my interest in a recent CNBC interview published on Yahoo! Finance. So, what did Breyer proffer [...]

Five Bold Stock Market Predictions For 2014: Revisited

It’s easy to make bold predictions about the stock market. It’s not so easy to get those predictions right. The stock market is never predictable. Anyone who tells you they know what’s going to happen is lying. Knowing that it’s a fool’s game trying to forecast what will happen next on Wall Street, I nevertheless [...]

More Recent Bull Markets Articles

View All Bull Markets Articles

popunder

Get the report FREE, enter your e-mail: