One How to choose stocks in a bull market?

In a bull market, as most individual stocks are rising, it is not very difficult to just demand profits. However, to achieve gains that exceed the overall market, it takes some effort and careful stock selection.

1. Choose leading stocks

Leading stocks are the soul and core of the stock market, and in a bull market, they play a leading role in driving the market forward. Often, they do not turn back throughout the entire bull market. Once the rise of leading stocks is weak, the bull market may be coming to an end. As long as investors follow the leading stocks, they will generally reap considerable rewards and have relatively low risks. Those that have seen astonishing gains in bull markets and are often the focus of most people's attention are often the leading stocks.

2. Choose high-performance stocks

High performing stocks are like sailing with the wind and moving forward at a high speed in a bull market. High performing stocks generally have the following characteristics:

(1) Strong intervention institutions; (2) The company has good fundamentals and excellent performance; (3) The public has a high evaluation of this stock; (4) The stock has a long period of accumulation before rising.

II Stock selection in bear markets

The difficulty of stock selection in a bear market is much greater than in a bull market or when the market is consolidating, because the overall market is constantly falling, and most individual stocks are also trending downwards step by step, with only a very small number of stocks rising against the trend. It's a bit like searching for a needle in a haystack to choose the bull stocks in a bear market from multiple stocks. Non professional investors without certain skills are better off giving up when faced with difficulties. Although stock selection is difficult in a bear market, there are still some patterns to follow.

1. Choose stocks that have undergone significant changes in fundamental conditions and are expected to experience a sudden increase in performance.

These types of stocks are highly sought after in both bull and bear markets. Due to a significant improvement in fundamentals, it will inevitably be reflected in stock prices sooner or later. Stocks with improved performance are bound to rise in bull markets, but remain resilient in bear markets!

      2. Choose individual stocks with long-term good development prospects

Companies with good development prospects are the goal pursued by most people when selecting stocks. These types of companies have stable operations and bright development prospects, and are highly regarded by many people. In a bull market, their stock prices may be high and their performance may be advanced. However, in a bear market, the market may experience a significant decline, especially during a sharp drop, providing investors with an excellent buying opportunity to buy a high-quality stock at a very low price. Of course, when choosing such stocks, one should focus on the medium to long term and not expect to reap high profits in the short term.

3. Choose stocks that oversold in the later stages of a bear market

In the later stage of a bear market or when the bear market has been ongoing for a long time and trading volume is shrinking, some individual stocks have experienced a deep overall decline, and the space for decline is limited based on comprehensive fundamental and technical analysis. Even if the market continues to decline, these individual stocks will stop falling early and start a stable rebound first.

In short, when selecting stocks in a bear market, one should adhere to the principle of caution, raise overall low-income expectations, evaluate whether a certain stock has investment value, and also determine it based on the market situation and average price to earnings ratio at that time.

III Stock selection in volatile markets

In a volatile market, the market generally operates in a box with a top and a bottom, oscillating up and down. At this time, you can choose individual stocks with similar trends to the market and conduct some short-term operations. The typical form of such stocks is rectangular. When the trend is determined to fluctuate in a regular rectangular pattern in the middle and later stages of the trend, one can buy near the bottom line of the rectangle and sell near the top line of the rectangle, making short-term inflows and outflows. If the amplitude of the rectangle is large, the short-term returns are also considerable.