This weekend marked the four year anniversary of the 2009 market lows, and it comes just days after the Dow Jones Industrials hit new all-time highs. So it seems fitting to assess this historic move and put it into context.
For this edition of Investing 101, we will grab the bull by the horns, and analyze these most lucrative periods of rising stocks that are typically referred to as bull markets.
What exactly is a bull market?
According to Investopedia, "Bull markets are characterized by optimism, investor confidence and expectations that strong results will continue." It's a term that can be applied to any type of securities trading but, the site says, it is most often used to describe the stock market, and is the metaphoric antonym to the term bear market.
How long do bull markets last?
That depends. According to the Stock Traders Almanac the longest bull market we've had since 1900 lasted 2,836 days and ran from October 1990 to July 1998, wracking up a whopping 295% gain for the Dow Jones Industrials along the way. The Almanac says that the shortest bull market in the past 100 years lasted just 61 days during the summer of 1932 yet still saw the Dow bounce 94%! Those are of course the extremes, but the average bull market of the past century has lasted 755 days and delivered an 85% gain. The current bull run is now four years old and up about 120%, making it significantly above average by both measures.
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