2020 has been a volatile year. Using the American S&P 500, the market reached a high on 19 Feb, fell 34% (1,149 points) and then has risen 28% (637 points). While the market has not fully recovered, there is a sentiment amongst some commentators that ‘the worst is over’.
With the economy still in lockdown and the news on coronavirus still concerning, it got us thinking – can the worst really be over? That led us to research some previous market crashes, and introduced us to the idea of a ‘bull trap’.
We unpack what we learned in this episode. By going through some lessons from history, we see that previous market crashes have followed a similar pattern – an initial fall, a partial recovery (50% retracement) and then a further fall where the market tests (and often breaks) the previous low.
It is important to note that this doesn’t always happen in market falls. So this is not a foregone conclusion. However, it is in the range of possible outcomes.
With this information in mind, we then talk about how we’re positioning our portfolios. Including one thing that Ren has done that surprised Bryce.
*******
If you want to let Alec or Bryce know what you think of an episode, contact them here.
*****
Some of our favourite resources and offers to help you during your journey:
- Want to do an online course with Equity Mates and Owen Raszkiewicz? We have the Beginner Shares Course and the Value Investor Program available now!
- Take control and track your investment portfolio with Sharesight
- Get a free stock when you sign-up to Stake, using the code EQUITYMATES
- Get exclusive access to our favourite data and insights platform, TIKR
- Take the emotion out of investing in Bitcoin, Ethereum, Gold and Silver with micro-investing app, Bamboo. Use EQUITY MATES for $10 when you sign-up
- Get $15 of Bitcoin, using one of our favourite crypto-currency exchanges, Swyftx
- Get 5 free trades if you plan to use the broker SelfWealth
*****
Make sure you don’t miss anything Equity Mates related by signing up to our email list. And visit this page if you love everything Equity Mates and want to support our work.
*****
Equity Mates Investing Podcast is a product of Equity Mates Media.
All information in this podcast is for education and entertainment purposes only. Equity Mates gives listeners access to information and educational content provided by a range of financial services professionals. It is not intended as a substitute for professional finance, legal or tax advice.
The hosts of Equity Mates Investing Podcast are not financial professionals and are not aware of your personal financial circumstances. Equity Mates Media does not operate under an Australian financial services licence and relies on the exemption available under the Corporations Act 2001 (Cth) in respect of any information or advice given.
Before making any financial decisions you should read the Product Disclosure Statement and, if necessary, consult a licensed financial professional.
Do not take financial advice from a podcast.
For more information head to the disclaimer page on the Equity Mates website where you can find ASIC resources and find a registered financial professional near you.
In the spirit of reconciliation, Equity Mates Media and the hosts of Equity Mates Investing Podcast acknowledge the Traditional Custodians of country throughout Australia and their connections to land, sea and community. We pay our respects to their elders past and present and expend that respect to all Aboriginal and Torres Strait Islander people today.
*****
Have you just started your investing journey? Head over to Get Started Investing – Equity Mates 12-part series with all the fundamentals you need to feel confident to start your investing journey.
Want more Equity Mates? Subscribe to our social media channels (@equitymates), Thought Starters * Get Started Investing mailing list and more, or check out our Youtube channel.
Equity Mates Investing Podcast is part of the Acast Creator Network.