Basics Intermediate: Understanding Bull and Bear Markets

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1.
Why do bonds perform well during bear markets?
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Their returns stay the same. Bond returns are fixed no matter what the market. They can't rise or fall.
2.
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.
3.
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.
4.
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.
5.
Which of the following does not contribute to bull or bear markets?
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Past bull or bear markets. Only present behavior can determine such markets.