As much as we’d like the stock market to move higher and never falter, it’s important to recognize that corrections, crashes, and bear markets are a normal part of the long-term investing cycle. Last year, all three of the major U.S. stock indexes plunged into a bear market, with the tech-focused Nasdaq Composite (^IXIC -0.39%) getting hit hardest — a 33% decline when the finish line was crossed.
While bear markets can be unpleasant in the short run and tug on investors’ heartstrings, they’re also, historically, the ideal time for patient investors to pounce. Even though we can’t consistently forecast when a bear market will begin, how long it’ll last, or how steep the decline will be, we do know that all previous bear markets have eventually been cleared away by a bull market rally. In other words, bear market volatility is a red-carpet invitation for opportunistic investors.
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