Wednesday, January 23, 2008

Behaviour of a Bear Market

We are now experiencing the behaviour of a bear market. The market falls by several percentage points every day. There is total loss of confidence.

Weak investors and margin traders are being squeezed out. Hedge funds are selling massively. There are virtually no buyers.

The market will rebound, after all of the selling has been done. Long term investors should just sit back and wait for the rebound. At the current level, the market is probably over-sold and is showing less than its fair value.
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2 comments:

Anonymous said...

Dear Mr Tan,

Thank you for your useful tip about staying invested, instead of panicking.

I was almost about to sell my shares, but I decided to wait ... as you have advised.

This turns out to be a good tip. I want to thank you. I never know that things can turn around some quickly, and the prices are now almost 10 percent higher than the point that I almost sold.

January 25, 2008 9:21 AM
Anonymous said...

So is this a good time to accumulate?

January 28, 2008 8:35 PM

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