Basics Intermediate: Understanding Bull and Bear Markets

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1.
If you believe in "buying low and selling high," at which of the following points should you sell your stock?
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When the stock begins to move downward. This signals that the bull market may be reversing, although it is never certain. This signal is not present during the other situations mentioned, because they may just be periods of slow growth.
2.
Bull market investors seek _______ more than anything.
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Growth. Bull markets are about rising prices, and rising prices are what growth is about. Therefore, income and dividends are secondary.
3.
Emotions can contribute to bull and bear markets.
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True. Aspects of investor psychology, such as emotions, can drive people to value stocks very high or very low.
4.
One way to profit during a bear market is to buy the stocks of companies that perform well in both bull and bear markets. What are these stocks called?
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Defensive stocks. They can go by many names. The most common is "defensive stocks."
5.
Economists and market-watchers use a practice called _______ to help them predict stock values.
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Technical analysis. This is the use of market data to analyze individual stocks and the market as a whole.