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Taming The Bear 🐻 : Managing Market Declines 📛

Markets have been a bit volatile over the past few weeks, and the future is uncertain.
For many investors, these moves can be troubling because it’s been many years since we’ve had a substantial decline–whether we do or do not from the current point (and, for the record, I think it’s much more like the market surprises us with new highs sooner than anyone would think possible),
we need to spend some time thinking about how to manage our portfolios and manage ourselves in a market decline.

First, watch YOUR LANGUAGE

•Labels are meaningless: Correction, pullback, —just words

•Listen to the terms people use: fake, rigged, propped up, short covering rally. The words we use matter because they carry emotional meaning.


UNDERSTAND MARKET PSYCHOLOGY

•Market moves are mostly emotional.
If you don’t understand that, you’re doomed to be at the mercy of the market.

•The news doesn’t matter (for prediction.) You need a plan for how you read the news!

•Market movements arise from competitive action of traders driven by both reason and emotion. This is why the market creates such emotional reactions in traders and investors.

•The “permabears” are interesting (and dangerous).

•Learn to monitor and understand your own emotions and reactions.


UNDERSTAND THE REALITY OF THE MARKET

•Markets are mostly unpredictable. No one knows what is going to happen in the future with any degree of reliability.

•Best guide is statistics, but need to understand what this means:
~On average, stocks go up over long time periods.
~Hard to short stocks.
~Strange things happen on shorter time spans.
~What is predictable in the future is fuzzy and uncertain, and deviations can be large.


•Most of the things people talk about follow the market, so they can’t be used to predict the market!
~The market is the leading indicator.
(Dow)


WHAT TO DO?

•The biggest mistake investors make is selling into declines.
~How to avoid? Don’t do it.
~Best plans are fading (going against) moves in stocks. If you implement this one rule, you’ll be ahead of the game.

•Always use limit orders. Always. Always.

•Buy at steep discounts, planning to hold for multiple years.
~Be a predator
~Buy “stupid” prices for things you are reasonably sure aren’t going out of business/away

•Be your own manager.
~Break destructive patterns
~Stop mistakes before you make them


CONSIDER SHORTING
Shorting is not evil or (that) complicated, but this is a topic for another day.


Listen To 'After Dark - MrKitty' Such A Nice Music in Time like this.....(this music is overrated lol)

and Wishyou Profita- Strong In This Weeks.!!

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