Email of the day on the size and duration of bear markets.
Comment of the Day

April 15 2020

Commentary by Eoin Treacy

Email of the day on the size and duration of bear markets.

Hi - in light of recent stock market rise I checked how past 2 bear markets behaved and found the following:

2000 bear (2 years)

2000 Aug 2001 Mar -29%
2001 Mar 2001 May +22%
2001 May 2001 Sep -28%
2001 Sept 2002 Jan +24%
2002 Jan 2002 Aug -34%

2008 bear (18 months)
2007 Oct 2008 Mar -20%
2008 Mar 2008 May +15%
2008 May 2008 Dec -44%
2008 Dec 2009 Jan +18%
2009 Jan 2009 Mar -28%

The second (2008) bear market was deeper and shorter. How do you anticipate 2020 bear market evolving? Will it be even deeper and shorter? Thank you

Eoin Treacy's view

Than you for this informative email which raises an important question about whether we are in medium-term correction within a broader secular bull market or is this a major market top which denotes the end of the secular bull market?

The peak in 2000 was the end of a 20-year secular bull market and represented the climax of a liquidity fuelled mania in the technology, media and telecoms sectors. The 2007 peak occurred within the context of a secular bear market which we defined a generational long process of contracting valuations and rising dividend yields.

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