Justin Pope, The Motley Fool

Sun, Jun 1, 2025, 12:20 PM5 min read

• Bear markets aren't fun, but historically, they have been fantastic buying opportunities.

• To avoid missing out on the rapid rebounds that tend to follow bear markets, the best strategy is to stay invested.

• 10 stocks we like better than S&P 500 Index ›

There may not be a scarier pair of words to see in a financial news headline than "bear market."

A bear market, typically defined as a 20% decline from a broad market index's previous high, can be jarring, especially when the sell-off happens quickly. You only need to recall the news stories in April when President Donald Trump's global tariff announcements sent the market tumbling to understand the fear a bear market can bring.

However, they're also a healthy and necessary part of the market's cycles, and understanding bear markets can help you navigate them wisely -- or even use them to your advantage. Here are four truths about bear markets that every investor should know.

Imagine you're at the start of a roller-coaster ride with your car slowly being pulled higher and higher. Then, you cross the peak and plummet back down at breathtaking speed. That can often be what stock market cycles feel like as they alternate between bull and bear markets.

Like that steady uphill climb, bull markets can last for a while. Between 1949 and 2024, the average bull market in the S&P 500 (SNPINDEX: ^GSPC) lasted 67 months, or just over five and a half years. In contrast, bear markets lasted an average of just 12 months, and the shortest lasted just 33 days. Bear markets may not be fun, but fortunately, they're usually over relatively quickly.

Since bull markets usually last much longer than bear markets, it pays to stay invested. Yes, the declines you'll see in the value of your portfolio during a downturn are discouraging. The average decline during an S&P 500 bear market was 34%, and the 2008 financial crisis was particularly severe with a 59% slump, according to Charles Schwab.

But if you stayed the course, held your stocks, and rode it out until the next bull market, you would have enjoyed healthy gains. Since 1949, the average bull market has seen a 265% gain. Of course, there's no guarantee future results will follow historical patterns, but investors can still take lessons from the stock market's behavior over long periods. Investors should remain optimistic.

One way investors commonly shoot themselves in the foot is by trying to anticipate what the economy or the stock market might do in the short term. Most people fail to grasp how quickly things can change on Wall Street, and the market can pivot long before you realize what's happened.