Nikhil Kamath Says Don't Get Carried Away By The Bulls, Prepare For The Bears

Nikhil Kamath, the co-founder of Zerodha and True Beacon, has shared his insights on the current market situation on Twitter, warning traders not to go overboard amid a strong bull market.

What Happened: In a recent tweet, Kamath warned that bear markets are significantly more impactful than bull markets.

Kamath said that if the current bull run has lasted longer than usual and that the volatility index (VIX) is at an extremely low level, investors should not get carried away, as everything is cyclical.

Kamath shared that the key lesson he has learnt about trading is that it’s more about not losing too much during lull periods rather than not making too much during the good times.

He also shared some statistics to underpin his point. He noted that bull markets typically last around one year and ten months on average. However, the most recent four bull markets have averaged over three years. Meanwhile, bear markets usually last less than six months.

The average gains during a bull market stand at 101%, whereas bear markets tend to see a decline of 33% on average, Kamath highlighted.

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Editor’s Note: Artificial intelligence was used as a secondary aid in the writing of this story.

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Posted In: EquitiesEducationMarketsGeneralNikhil Kamath