Most Investors Fear Bear Markets. My 7-Year Track Record Shows They Should Welcome Them.

Key Points

• Bear markets are rarely cheerful times for investors.
• That's largely a product of transient psychological factors rather than a lack of suitable long-term opportunities.
• Automation can be the difference between doing the right thing by default and retreating from the market at the wrong moment.
• 10 stocks we like better than SPDR S&P 500 ETF Trust ›

A bear market is traditionally defined as a decline of 20% or more in a broad market index that lasts at least two months, per the U.S. Securities and Exchange Commission (SEC). A bull market is the same size move to the upside. Bitcoin (CRYPTO: BTC) is an easy way to appreciate these dynamics, with its price crashing from its all-time bull market high near $126,080 in early October 2025 to its bear market low near $58,556 in late June of this year. The coin also experienced a bear market in 2022, among other earlier instances.

I bought Bitcoin throughout both of those bear markets. I also bought the SPDR S&P 500 ETF Trust (NYSEMKT: SPY), an exchange-traded fund (ETF) that tracks the S&P 500, during the stock market's 2022 bear market. I started investing more consistently and more seriously in late 2019 and early 2020, so that's nearly seven years of regularly buying these assets, no matter what kind of market is happening. The returns from doing so have convinced me that the bear markets that many investors dread are actually where there's the most opportunity.

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Buying Bitcoin's 2022 bottom returned 393%

It's easy to say investors should be loading up during bear markets, but it's much harder to actually do so when the market keeps losing ground day after day.

The previous crypto bear market was, by some metrics, more difficult than this one. According to a CoinGecko study from late June this year, Bitcoin fell by 77% over 381 days, bottoming at $15,742 on Nov. 10, 2022. Anyone who bought at or around that low and held through Aug. 31, 2026, is up by 393%. For returns like that, the wait wasn't even very long, and investors didn't need to time their purchase precisely at the bottom to do well.

Doing the same thing with stocks also yielded good results. The S&P 500 declined by 25% across 282 days in 2022, closing at its low of 3,577 on Oct. 12. An S&P 500 investment at that low point would be up by 94% as of Aug. 31, 2026, before dividends.

Of course, I didn't buy either asset at the exact bottom.

I just kept buying on a regular, once-per-week schedule via dollar-cost averaging. I specifically remember sitting in my living room in 2022, looking at my accounts on my computer, grimacing, and considering whether to stop my automated purchases, as many down weeks had gone by, and it felt like I was throwing money into the incinerator. It felt bad to continue with what looked like a failing strategy, and seeing all the red in my accounts every day felt bad in general, especially after having recently experienced the market euphoria in 2021.

But I stayed the course, and it eventually paid off.

Make a plan and keep some cash at hand

You need to prepare for bear markets because they're inevitable.

Twenty-seven of them have happened in the S&P 500 since 1928, according to research from Hartford Funds conducted in 2025, with each bear market averaging a total of 289 days. The average bull market lasts 988 days, which should give you plenty of time to hone your strategy of regular purchasing, and also to sock away some additional cash to keep in reserve for the moments of maximum opportunity.

That reserve can sit unused for years, but it'll still serve a valuable psychological purpose.

Without any money on hand, when a bear market rolls around, even with a regular purchasing schedule, you still might feel a bit powerless, which can often lead to making impulsive and suboptimal financial decisions. Similarly, if you have some capital and the bear market presents some deep discounts on assets that you'd like to own for the long term, you can opportunistically accumulate them faster than you might be able to otherwise, which can really boost your morale when your portfolio is getting battered daily.

You don't need to like bear markets; you just need to act on them in a timely fashion. Copy my plan: Automate the buying, accumulate the quality assets at a faster pace while they're cheap, and then appreciate your efforts a few years later.

One last trick: Looking at your portfolio doesn't change its value. If you don't like what you see during a bear market, close the window and come back in a few weeks.

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Alex Carchidi has positions in Bitcoin and SPDR S&P 500 ETF Trust. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.