Making money in a Bear Market (or in a declining security) is very simple to execute when you understand how to trade options.
Some of the most incredible trading profits can be made when prices fall – because it is widely known that Stock prices fall much faster than they rise! If you remember back in the 2008 credit crisis: the market wiped out 5 years of market gains in a matters of weeks.
Some of the most prominent and effective trading strategies that can be implemented in bearish markets consist of:
The beautiful thing about being successful in bear markets is that you only need to understand and implement 1 or 2 of the above-mentioned strategies to generate significant profits when prices fall.
One of my favorite bearish strategies, that I have been consistently successful with in bear markets, is selling vertical call spreads on weak stocks that are down trending indices.