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But every investor knows they'll suffer through at least a few of them. Data gathered by mutual fund company Hartford indicates a bear market materializes about once every three and a half years, taking an average toll of 35% on the S&P 500's (SNPINDEX: ^GSPC) value. It's understandable why anyone would attempt to sidestep them.
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What if, however, rather than playing defense against bear markets, an investor made a point of playing offense during them? In other words, what if you were an aggressive buyer rather than a seller during and because of a bear market? In the long run, you'd be a lot better off. Here's why.
Don't misunderstand. You shouldn't sell your long-term holdings at what looks like the end of a bull market and the beginning of a bear market just to have plenty of cash ready to deploy; the likelihood of successfully spotting a peak and then also successfully identifying the exact bottom is slim anyway.