Market loss is 3x faster than market gain

[zdreg]

The article I put a link on says it's three times. Whatever it is I just know from experience that things fall apart much faster than they go up. I am positive it is driven by fear. We all understand what panic selling is I don't think there such a thing as panic buying

"We all understand what panic selling is I don't think there such a thing as panic buying"
your response is humorous.
you never heard of short squeezes?

 

[theapprentice]

Market going down might be faster, but also much less likely too actually happen.

 

[zdreg]

I knew this but wanted some data to back it up. This is why I love the shorts.
Even on a intraday basis I'm sure this is true.
I'm still looking for that data.
Enjoy

https://seekingalpha.com/article/31...cks-really-drop-3-times-faster-than-they-rise

1. the shorts will not love you back.
2."Even on a intraday basis I'm sure this is true. "
with 8 posts you should be humble and be sure of nothing.

 

[bigsnack]

With Es specifically, I can't tell you how many times I've been in a chat with dudes who are in awe of some early morning selloff, and yet the Range of the pm rally ends up bigger than the selloff by 5 points or more...

 

[Jdesey]

Well the replies have been interesting. I didn't know It was such a controversy. We can all make money long or short it really doesn't matter does it. Good trading to everyone

 

[wartrace]

"Market" is a pretty generic. Maybe you should have posted "EQUITY MARKETS"? I haven't noticed any disparity in market bias when trading currency.

 

[lindq]

We all understand what panic selling is I don't think there such a thing as panic buying

Once you get caught in a rush to cover shorts, you'll learn the hard way that there is indeed such a thing as panic buying.

 

[Jdesey]

Once you get caught in a rush to cover shorts, you'll learn the hard way that there is indeed such a thing as panic buying.

I understand the short squeeze but Only a fraction of the volume in the equity markets are shorts. Especially when we're talking anout retail investors. Blows my mind how many today's to make money when things go down. I had a thirty minute conversation with a friend of mine today trying to explain how a short works and he still didn't get it.

 

[recession2016]

Market going down might be faster, but also much less likely too actually happen.

Only in bull markets

 

[neke]

Doesn't sound logical to me.



Your filter with new highs and lows would take some more time to account for, but just looking at daily change for 2010 to the middle of 2016:

>= 3 % = 12 days

<= -3 % = 15 days

So, a slight skew to the down side.



Based on memory or hard data?

I wouldn't trust my own memory.

The point I'm trying to make is that my experience and data suggest that the up moves certainly are comparable to the down moves, both in size and speed.

When you realise that 2010 to 2016 has been a tremendous bull-run, to see the number of big decliners outpacing big runners makes my point.

Now based on hard-data based on my premise (avoid big moves that are just dead-cat bounces from prior sell-offs, or sell-offs following prior run - no new 3-month price level record being set), I went back ten years ago (June 2007 till date on the SPY), and here are moves meeting my definition. Only two run-ups, and 22 declines

Run-ups

Date Fractional rally
04/05/09 0.03402
27/10/11 0.034835

Decliners

Date Fractional decline
15/09/08 -0.04759
17/09/08 -0.04496
29/09/08 -0.07836
06/10/08 -0.05093
07/10/08 -0.04479
09/10/08 -0.06984
24/10/08 -0.05071
27/10/08 -0.0355
19/11/08 -0.06408
20/11/08 -0.07423
23/02/09 -0.03578
02/03/09 -0.04504
05/03/09 -0.04085
04/02/10 -0.03087
20/05/10 -0.03776
04/06/10 -0.03514
29/06/10 -0.03088
04/08/11 -0.04684
08/08/11 -0.06512
21/08/15 -0.03108
24/08/15 -0.04114
24/06/16 -0.03643