Bull Markets vs. Bear Markets

Two Sides of the Market

Markets move in cycles. They don't just go up in a straight line — they swing between optimism and fear, growth and contraction. The two main phases investors talk about are bull markets and bear markets.

Bull Markets

A bull market is a period when prices are generally rising and investor confidence is high. The name comes from the way a bull attacks — thrusting its horns up.

Characteristics:

• Stock prices rising 20%+ from recent lows
• Strong economic growth
• Low unemployment
• Rising corporate earnings
• Investors eager to buy

Bull markets can last years. The 2009–2020 bull market lasted more than a decade, with the S&P 500 rising over 400%.

Bear Markets

A bear market is the opposite — prices are falling and fear dominates. The name comes from the way a bear swipes down with its paws.

Characteristics:

• Stock prices falling 20%+ from recent highs
• Slowing or contracting economy
• Rising unemployment
• Falling earnings
• Investors selling or sitting out

Bear markets are usually shorter than bull markets, but more intense. The 2008 financial crisis bear market saw the S&P 500 drop nearly 57%.

Why This Matters for FSL

In a bull market, most stocks rise — the tide lifts all boats. Winning requires picking the stocks that rise fastest.

In a bear market, most stocks fall. Winning means picking the ones that fall least (or actually rise against the trend — defensive stocks, healthcare, utilities).

Great FSL players adapt their draft strategy to the current environment. "All tech, all the time" works in a bull run and fails badly in a bear market.