Basics Intermediate: Understanding Bull and Bear Markets

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1.
The net advance measures the difference between the number of stocks advancing in price and the number declining in price.
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True. From this comes the advance-decline line.
2.
What does the advance-decline line use to forecast market trends?
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A net advance. This figure measures the difference between the number of stocks advancing in price and the number declining in price.
3.
What was the longest bear market in the United States?
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The Great Depression. By far, this was the longest bear market.
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.
A portfolio with a lot of stocks can be very profitable during a bull market.
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True. Stocks are able to take advantage of growth because they are made of shares, which typically grow in value during bull markets.