Bull Markets Explained: When Assets Stop Asking Permission to Moon

Ever notice the stock market acts like a moody teenager? It goes through phases—sometimes everything’s on fire (bull market), sometimes it all burns down (bear market). This cycle has been on repeat since tulip mania, the Great Depression, dot-com, 2008, and now post-COVID inflation blues.

The Simple Definition

A bull market is basically this: an asset rises 20% from rock bottom and keeps climbing. That’s it. It’s a sustained uptrend where things just keep going up. The metaphor comes from bulls charging forward relentlessly—hence the term.

But here’s the catch: prolonged bull runs can breed unrealistic expectations, creating asset bubbles where valuations become completely divorced from reality. Then? Sharp crashes. Bear markets take over. It’s cyclical, and it always has been.

What Actually Drives Bull Markets?

Bull runs don’t happen in a vacuum. They need fuel:

• Wage growth and employment staying strong
• Money flowing into markets
• Consumers actually spending (not hoarding cash)
• Companies making solid profits
• Government support (stimulus packages, low rates)

Flip the script? When unemployment rises, spending dries up, earnings tank, and uncertainty creeps in—markets start bleeding.

The Numbers That Matter

How long do they last? Average: 3.8 years. (That 2009-2020 run? 11 years. Anomaly. Don’t count on it.)

Average returns? Around 112% from start to finish. Not bad for patient money.

Bear markets? Way shorter—average 9.6 months. But they can be brutal when they come.

Bull vs. Bear: The Cliff Notes Version

Should You Buy During a Bull Run?

Theorically, yes—112% average returns is tasty. But timing is brutal. Buy near the peak? You’re catching a falling knife.

Smart play: Dollar-cost average into broad index funds over years. U.S. indexes historically crush all-time highs over time. Diversify sectors. Reduce single-stock risk. Patience beats timing.

The Wildcard: Black Swan Events

Bull markets take time to build. Bear markets? Can drop overnight when something unforeseen hits (COVID, geopolitical shock, etc.). That’s why diversification and risk management aren’t boring—they’re survival.