:( Indian stock market to hit bear market ?

Analysts feel that India is set to hit the bear market soon. Here's why they feel that and why it may not be such a bad thing.

A once in a 100-year pandemic, a once-in-75-year war in Europe and 40-year high inflation in the US.

These are surely?strange?times that we are living in.

And?strange times?lead to?strange?(and maybe even tragic) changes in the markets.

Something similar is happening right now, with the S&P 500, the Nasdaq and the MSCI ACWI Index (check out Noob’s Corner) in the bear markets.

But what does this mean for India?

?What is a Bear Market?

The bear and the bull market are terms that define how the stock market is performing.

The bull run means that the stock market or an index has risen by 20%.

And the bear market is when the market or an index has fallen 20% from its all-time high.

As we said, global indices are currently seeing a bear run, thanks to all the history-making events going on right now.

Even the Nifty is down?15%-16%?from its all-time high of 18,604.45 points.

Does this mean that a bear market is coming to India?

Well, the verdict's still out on that.?

Different analysts have different views, with some saying that a bear market is inevitable given the global conditions, while others are still bullish.

But here's why most people feel that a bear market is inevitable:

• FII and FPI selling:?Even though foreign direct investment inflows are at its all-time high right now, cash outflows are increasing. Foreign institutional investors have sold?Rs. 2 lakh crores?worth of stocks, a record-high. Meanwhile, foreign portfolio investors have sold?Rs. 1.14 lakh crores?of equity.?

These investors now see better investment opportunities in other countries which have raised their interest rates now.

• Valuations Too High:?Many analysts and investors feel that the valuation of some stocks, especially those belonging to the tech sector, has gone insanely high due to the excess liquidity in the market. And with talks of an upcoming?recession?or worse?stagflation, these companies will no longer be able to grow at the expected rate. This is why both domestic and foreign investors are on a selling spree.

Add to all this the high inflation and the global scenario, and a bear market seems pretty inevitable.

So, should we all panic now?

?Bear Market Worries Could be Overhyped

The bear market is a part and parcel of an investor's life. On average, a bear market occurs every?3 years?and takes around?245?days to reach rock bottom and?465 days?after that to rise up to its all-time high.

In India,?five out of eight?bear markets have recovered within 8 months.

And while this may still seem too long to the average investor, this dark and gloomy cloud has a silver lining.

After every bear market comes a bull run, no matter how long it takes.

So, this could be a great opportunity to shop for stocks at a discounted price.

But bear markets could still do a lot of damage to your portfolio if you're not careful (for instance the dot com bubble saw stocks fall by?78%), so here are some tips to survive this danger:

• Play Safe: It may seem like an all-you-can-eat buffet to investors. But just like eating too much is bad for you, so is investing too much. Be careful, especially because with a possible recession coming, you will need a lot of liquidity.
• Diversify: Diversify your investments not just in the stock market but also elsewhere. With interest rates rising, the bond markets could be a lucrative investment opportunity.
• Don't Take Unnecessary Risks: The bear market can be just as lethal as an actual bear, so?don't take unnecessary risks by investing in volatile or speculative assets.

Investing in recession-proof sectors is also a good idea.

And you know what? We may not even see a bear run. India has become more resilient to bear runs in the last few years with more investors in the market now.?

Since 2013, we have only had two bear market runs.?

And some analysts feel that the record high sell-off from foreign investors is because investors are pulling money out of the emerging markets basket as a whole from the MSCI ACWI index. The economic outlook of many countries in this basket (like?Pakistan,?Sri Lanka?and China) does not look very favorable right now. But that's not the case with India. They claim that foreign investors are still very much interested in investing in India.

So, all this worry may be for nothing.

And even if the worse comes to worst, you could still see it as an opportunity to prepare for the next bull run.

Now, all we need to do is wait and watch and see if the markets actually fall or not.