Retail Investors Who’ve Only Known Bull Markets Are Buying the Dip
The retail trading mantra that’s worked for all his life: Buy the dip.
Anyone under 40 only has experienced bull markets in their adult lives, starting with the one that emerged from the rubble of the financial crisis in 2009. Arnett was middle-school aged back then.
That rally ran for 11 years, becoming the longest on record.
And while its demise was swift as the Covid pandemic shuttering the global economy, the ensuing bear market was the shortest ever, just 33 days, and provided investors with one of the greatest buying opportunities in history.
Such swift rebounds have conditioned a generation of investors to see downturns as sales.
Stocks have risen in every rolling 10-year period since World War II, outside of the Great Financial Crisis.
That’s conditioned investors who can wait for decades to tap their portfolios, to keep buying.
“American investors of all ages have a perception of America as a safe haven of capital in the world,” said Peter Atwater, adjunct professor of economics at the College of William & Mary and president of Financial Insyghts, an institutional consultancy.
“And the idea that that may not be the case is a fundamental shift in how Americans have to think.”
Bloomberg 15 April 2025
Dipbuyers now - Dipsellers later?
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