How you can outperform the TSX in a bear market

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The global stock market correction at the beginning of February may have worried you, and you may be concerned that another market correction or, even worse, that a bear market might be coming soon.

If the possibility of a bear market worries you, you can prepare yourself for it. It’s possible to outperform the TSX in a bear market.

Don’t panic

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First, it’s important that you don’t panic. Staying disciplined and keeping calm is the best attitude.

Unless you need your savings for a short-term expense, selling your stocks after their value has declined will materialize what was previously virtual losses. To make money with stocks, you need to buy low and sell high, not the other way around.

Keep your goals and your long-term outlook in mind. Don’t panic when your stocks fall in value. If you are investing for your retirement in 30 years, your long investment horizon allows you to take more risks. You have time to regain what you have lost.

Moreover, if you look at markets performance over many years, you will see that they have always risen over the long term, despite short-term declines. To limit your losses, make sure your portfolio is well diversified.

If you are retired or close to retirement, you should secure a portion

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