Spread out your risk
Whether it’s a bull or bear market, the one thing investors should always try to do is spread out their risk; you never want the success of your investment portfolio to rely on a few investments. One of the best ways to spread out risk is to invest in index funds. If I had $10,000 to invest during a bear market, I would solely focus on the S&P 500.
Not only is the S&P 500 comprised of companies with large market caps — usually indicating they’re more established and able to survive down periods — but those companies also span many industries. It’s not uncommon for industries as a whole to grow or decline together, so being exposed to multiple sectors helps you invest in the market as a whole.
Don’t invest it all at once
If I were investing $10,000 in a bear market, the one thing I would make sure of is that I didn’t invest it all at once. Instead, I would use dollar-cost averaging to help hedge me against the possibility of investing a lump sum right before a huge drop in a stock’s price.
