Bull Market

A bull market is the mirror of a bear: by the usual convention it begins once a major index has risen 20% from its most recent trough, and it runs until the next 20% decline ends it.

They last far longer than bear markets and account for the bulk of long-run returns. That asymmetry — long expansions punctuated by shorter, sharper contractions — is the structural reason a diversified portfolio held for decades has historically grown despite repeated losses along the way.

The danger in a bull market is subtler than in a bear. Years of gains make risk feel abstract, encourage concentration into whatever has run hardest, and quietly push a portfolio far beyond its target allocation. A 70/30 mix left alone through a long rally can become 85/15 without a single decision being made.

It is also where the phrase "a rising tide lifts all boats" does real damage, because strong returns make almost any strategy look sound. Costs, concentration, and poor diversification tend to stay invisible until the tide goes out.

Rebalancing is the discipline that matters here, and it is hardest precisely when it works best: trimming the winners feels like a mistake right up until it is not.