Identifying bull phase is a great quality of a good investor. This can be done through collecting and analyzing latest updates related to the economy. A good investor should be able to understand and predict how such changes or actions affect the stock market. Here are some indications related to bull phase to update your knowledge:
Bull market is the final result of any changes or actions that supports the growth of economy. If economy is stable and growth is consistent, you can expect a long run bull phase in stock market.
1. Rise in corporate earnings – This is the best indicator on a growing economy. As economy grows along with business stability and capacity to produce better earnings, is a positive symbol to the forthcoming bull phase.
2. Law inflation rate – Low inflation supports the bull market in a great extend. Low inflation support companies by reducing its production costs thus the earnings will be increased continuously. This can leas to a bull run.
3. Law interest rates – There is no secret that when the interest rate is law the stock market will be up and when the interest rate is high, the stock market will go through the bear phase. Any news on reducing the interest rate could be a clear sign to an investor on the nearest bull phase.
4. FII fund flows and increased investor interest– This is another clear sign to the nearer bull phase in the stock market. Increasing interest from big investors and fund houses will make the public happy and they also start participating to the market in a great extend. This is a good sign and can make the price for each stock up and the bull market will be on the screen.
Above are the major indicators that help an investor to identify the forthcoming bull phase easily. It is all visible or the information available in public. There is no extra effort required to understand the above mentioned indicators.