Understanding the efficient market hypothesis
The “efficient market hypothesis” is a popular theory in academic finance that states that asset prices fully reflect all available information. This implies that it is impossible to “beat the market” since prices only react to new information.


Like much in academia, this hypothesis fails in the real world:


  1. it is disproven by the tremendous success of investors such as Warren Buffett, George Soros, Jim Rogers, John Henry and Ed Seykota.
  2. it fails to account for the long-term documented success of investment strategies such as trend following in bull and markets.

Therefore, you should not let such theories dissuade you from investing for bull and bear profits.


The Bull And Bear Profits formula for maximizing investment profits and beating the market
The formula for maximizing investment profits is simple...



The Bull And Bear Profits approach to maximizing investment returns and beating the market is to:


  • buy a stock or ETF when it is 1) in a bull market uptrend and 2) outperforming a key benchmark, such as the S&P 500
  • sell (or short) a stock or ETF when it is 1) in a bear market downtrend and/or 2) underperforming a key benchmark, such as the S&P 500...or when it simply falls to -- or below -- an established stop-loss price

Most investors, professional and beginners, only focus on profiting in bull markets. By contrast, the Bull And Bear Profits approach to investing focuses on profiting in ALL market environments, bull and bear alike.


The key to minimizing costs is becoming an educated investor and investing on your own, rather than relying on high-priced and often conflicted Wall Street "professionals."


This guide will cover the basics you need to know for do-it-yourself investing, including how to:


  • find a good online stock broker with low commissions for stock and ETF trades,
  • find good low cost ETFs,
  • identify which stocks and ETFs to buy and
  • enter buy and sell trades on your own.



For a more detailed discussion of the risks of "buy and hold" investing and why mutual funds do not work, please see our free Special Report titled “Why You Should Invest For Bull & Bear Profits."




Education
Many investors are not aware that there is pronounced seasonality in stock market returns, such as…