Explained: Bullish versus Bearish in Finance
Bulls think the price of something will go up.
Bears think the price will go down.
For example, a bull might buy a stock because they think its price will increase. A bear would sell out, short it or not buy at all.
Why is the timeframe important?
If you ask an investor, “are you bullish on XYZ stock?” they might say, “yes”. But that alone doesn’t tell you much.
Their timeframe for investing might be different to yours and they could change their opinion depending on the time horizon.
For example, they could be bullish over the next month but bearish over on the next five years.
That’s why it’s best to ask how they long they are investing for.
Why is it called Bear and Bull?
No-one knows for certain but one thing we know is that bulls attack with their horns by going forward and swinging upwards. Bears swing their claws down.
We don’t have proof, but it sounds good!
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