You probably know that the best way to make serious money over time is either a high-paying career or investing in the stock exchange. While the various major stock markets, such as the Dow Jones, the S&P 500, tsla and Nasdaq, certainly have small periods of significant contraction, over many decades, they tend to have significant growth. Regular amounts invested month after month grows in a compounding fashion, and often prove a great way to save up for retirement or investing in a home or a college education.
The reason that this is successful is that there are more bull markets than bear markets. A recession is defined as any two consecutive quarters of economic contraction, and while these happen from time to time, bull markets can last multiple years. These are time periods when the average values of most stock prices are going up, which means that if you buy a share in something today and just hold it, it will be worth later on, just given the hot market.
Individual sectors and industries of stocks can have their bull markets even when the general economy does not. If you have a broadly diversified portfolio of investments, then a quarterly re-balancing can take the profit from bull market stocks and reinvest them in slower sectors that will eventually turn into their bull markets. Doing this keeps your portfolio growing almost all the time, as the current winners prime you to capitalize on market segments turning around to explode themselves.
It should be noted that the term of a bull market does not just apply to stocks and equities. It can also be used to refer to prosperous times in currencies, bonds, and even commodities when they are hot. Find more – http://stonybrooksecurities.com