Lessons for stock market investors: 13 Things to Understand about Bears
1. There are lots of signs in Grand Teton and Yellowstone National Park that read “Be Bear Aware.”
- Lesson for Investors: Even when things look great, bear markets come with the territory.
2. Every local has bear stories to share.
- Lesson for investors: If you invest long enough, you will see more than one bear.
3. Hikers are reminded to carry bear spray – which is proven to be “90% effective”- but 100%
effective in producing sales.
- Lesson for Investors: Hold some cash, buy some insurance, and realize there is always someone selling protection from bears, but nothing is 100% effective. Per my river guide, statistically you are more likely to be killed by avalanche and moose than bear. l still bought the bear spray and I am glad I did. It was a small price to pay.
4. Bears prefer higher elevations and are lazy. As a result, they prefer to run downhill.
- Lesson for Investors: High valuations and high multiples make bear markets more likely.
5. Bear attacks are most common in the months of July, August, and September.
- Lesson for Investors: During these months, bears come out of the winter hibernation looking for food and the number of outdoor recreationalist increases making encounters more likely.
6. Bears are largely solitary animals.
- Lesson for Investors: Listen to the independent, solitary bear.
7. Hiking in groups and making noise to reduce the chances of being attacked.
- Lesson for Investors: When there are many people making noise about bears, there is a lower likelihood of being attacked. Worry when it is too quiet.
8. Older bears tend to be heavily scared.
- Lesson for Investors: It is hard living as a bear, but those that survive are some of the most dominant creatures of the forest.
9. Bears are curious and have a keen sense of smell.
- Lesson for Investors: Bears and short sellers are naturally curious and are easily attracted by unprotected food.
10. Bears are fast and charges and attacks happen quickly.
- Lesson for Investors: Mentally rehearse what you are going to do before you go hiking or invest because chances are you will not have much time to react when bears attack.
11. If attacked. DON’T RUN! Bears instinctively chase running prey and run 35 miles per hour.
- Lesson for Investors: Stay invested despite your fear. It’s not easy. I admit to being intimidated by the grizzly I saw 20 yards away given his size, despite being in my rented Toyota Prius. I had the bear spray ready, having seen Youtube videos of them climbing on cars.
12. If your bear spray fails. Get face down on the ground, protect your neck, and wait as most bear attacks are short.
- Lesson for Investors: You are statistically better off submitting than fighting, though in rare circumstances you may have to fight. The key is to protect your most vital parts like your neck, ideally with your backpack, and wait before moving to insure the bear has left the area. For investors, this means you may need to sell down a few positions to protect your best positions and don’t rush into a bear raid, wait until the bear has left the area.
13. Finally, most people do the wrong things when they encounter a bear.
- Lesson for Investors: When I saw the grizzly bear, others were stopping, getting out of their cars and approaching for better pictures, which is exactly what the ranger information said not to do. Instead, Be a Bear Aware Investor.
IMPORTANT DISCLOSURES:
Securities offered through FinTrust Brokerage Services, LLC (Member FINRA/ SIPC) and Investment Advisory Services offered through FinTrust Capital Advisors, LLC. Insurance services offered through FinTrust Capital Benefit Group, LLC. This material does not constitute an offer to sell, solicitation of an offer to buy, recommendation to buy or representation as the suitability or appropriateness of any security, financial product or instrument.
This report is prepared for general circulation. This report is not produced based on any individual persons or entities investment objectives or financial situation and opinions expressed by the analyst are subject to change without notice. This report is not provided to any particular individual with a view toward their individual circumstances. Investors should consider this report as only a single factor in making an investment decision. Securities prices fluctuate and investors may receive back less than originally invested and are not guaranteed. Investing involves risk including loss of principal.
Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed.
Past performance is no guarantee of future results and the opinions presented cannot be viewed as an indicator of future performance.
*FinTrust Capital Advisors, LLC and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction.
