The stock market has been on an unprecedented bull run for nearly a decade, and even moderately savvy investors have been able to take advantage of these favorable conditions. Additionally, there has been an influx of new investors who are conditioned to believe that ‘stocks only go up’. However, becoming overconfident while using suboptimal strategies can end up costing people who do not have a proper financial education. There are just as many, if not more, stories about people who lost their hard-earned money as there are people who struck it rich.

These losses can happen if the market shifts its sentiment, or money rotates out of certain securities, or any number of disruptions. What is important to know is that traders who have a plan are more likely to than someone who is just winging it.  While there is no way to predict what direction and pace the stock market will take in coming years, there are ways you can provide yourself the best opportunity to prosper regardless of current stock market conditions.

Bull Market vs. Bear Market

When learning how to buy or sell securities over any time period, it is important to have an understanding of the type of market those securities lie in. Whether they are stocks, options, or cryptocurrency, the history of a market’s actions will always influence your decision-making. Bull Market and Bear Market are labels for the two strongest trends that a market will follow. 

Bear Market Definition
Bull Market Definition

The stock market has historically been a tremendous vehicle for growing wealth because its overall trend is up. Though this is not guaranteed, it has been a strong component of the American and world financial system, and a market with significant investor confidence has a great chance of succeeding. Due to this overall sentiment, bull markets have occurred for 78 percent of the last 91 years, with an average bull market run of almost 3 years. 

We always reiterate that the market environment does not guarantee success for anyone. While you might hear stories of people jumping into the market this last year because ‘it’s too easy’ to make money, the reality is this is not true. Even in good market conditions, you have to be making good decisions based on fundamental market realities, or risk losing your hard-earned cash.

Opportunities in Any Market Condition

One typical truth to long-term stock investing is that you can keep your money safe by investing in the broader market indices and expect an annualized rate of return between 3-7% when all is said and done. However, there are opportunities for much more than a standardized annual rate of return if you are knowledgeable about the stock market and how to day trade in any market condition. The foundation to a financial education for exponential returns begins with a solid understanding of the following:

Never Trade with Money You Can’t Afford to Lose

As bull markets create euphoria and bear markets create fear, both markets create desperation for those who are investing outside their comfortable working capital. Make sure the amount you are allotting to trade (especially at the beginning) is something you are OK with risking. You will remain calm, make better trades, and be able to learn and make decisions with a clear mind.

Learn about all types of securities and ways to trade them

There are many different ways to trade the markets, from stocks, options, Futures, and Forex. It is worth learning to trade the many vehicles available in order to fit trading into your lifestyle and at the same time, meet your financial goals. Trade both directions of a market.

Most people believe you can only profit when the market is going up. At StockAbility, we teach how to make money whether the market is going up, down, or sideways. In fact, we teach that you should not approach the market with any sort of bias. You take your trade based on your analysis, whether that’s a long or a short. 

how to start day trading

Invest in education early

The stock market moves at such a rapid pace that trying to take it on without courses, coaches, and proper financial education can be extremely costly. Collaborating with experienced professional traders who can dramatically improve your learning speed will set you up both short and long term.

No matter what style and market you are looking to trade, the baseline of a profitable strategy is continued education. Trading is a zero-sum game, and every component of the market evolves on a daily basis. By surrounding yourself with successful traders and proper resources, you will be able to create financial armor to guard you for years to come.

Learn From the Pros at StockAbility™

At StockAbility™, we know that getting started is the hardest part of building a successful trading business. With that in mind, our team has helped many traders educate themselves for a brighter financial future. 

With the best coaches, classes, and proprietary trading techniques, it’s easy to see why our community helps equip our students with both the knowledge and skill to succeed. Sign up for one of our webinars today so you can see what your future trading team is all about.