Bull Market Singapore

Bull Market Singapore

A bull market is a sustained period of rising prices in financial markets — typically defined as a 20% or more rise from a recent trough. Understanding bull markets helps Singapore investors recognise market cycles, manage expectations, and avoid overconfidence during strong rallies. Not financial advice.

Table of Contents

Contents — Click to expand
  1. What Is a Bull Market?
  2. Bull Markets in Singapore History
  3. Impact on S-REITs
  4. Investor Behaviour in Bull Markets
  5. Risks of Bull Markets
  6. FAQ

What Is a Bull Market?

A bull market is conventionally defined as a rise of 20% or more in a broad market index from its most recent trough, accompanied by sustained investor optimism, rising economic indicators, and positive corporate earnings. Bull markets can last months to decades — the post-GFC US bull market (2009–2020) was the longest on record at approximately 11 years. They are characterised by increasing risk appetite, higher valuations (price-to-earnings ratios), and robust trading volumes.

Bull Markets in Singapore History

The Straits Times Index (STI) has experienced several notable bull markets. The post-Asian Financial Crisis recovery (1999–2000) saw the STI more than double before the dot-com bust. The post-GFC recovery (2009–2015) saw the STI recover from ~1,500 to above 3,500. The post-COVID recovery (2020–2021) was particularly sharp, with central bank stimulus driving a rapid market rebound.

Singapore’s bull markets are often linked to global risk-on sentiment, strong trade data, property market strength, and banking sector performance. DBS Group, OCBC, and UOB — which comprise a large portion of the STI — tend to lead during bull phases driven by rising interest rates or economic expansion.

Impact on S-REITs

During bull markets driven by falling interest rates or strong economic growth, S-REITs typically outperform as their distribution yields become more attractive relative to bond yields, and property valuations rise. The 2020–2021 REIT bull market saw many S-REITs return to pre-COVID prices and in some cases reach new highs as investors sought yield in a near-zero interest rate environment.

However, not all bull markets benefit REITs equally. A bull market driven by rapid economic growth and rising inflation — which typically leads to higher interest rates — can be more challenging for rate-sensitive REITs even while broad equities rally.

Investor Behaviour in Bull Markets

Bull markets tend to breed overconfidence. Common behavioural pitfalls include: chasing recent winners (momentum bias), concentrating in high-performing sectors, reducing diversification, taking on margin debt, and abandoning long-term investment discipline for short-term gains. For Singapore dividend investors, the biggest risk is overpaying for S-REITs or dividend stocks during a rally, compressing prospective yields and leaving little margin of safety.

Risks of Bull Markets

The main risk in a bull market is complacency. Asset prices can become stretched — P/B ratios for S-REITs above 1.3–1.5x NAV, for example, offer less value than buying at 0.8–1.0x NAV. Disciplined investors continue to dollar-cost average, maintain diversification, and periodically rebalance during bull markets rather than abandoning their strategy. A phased approach to deploying capital (rather than lump-sum at market highs) helps manage valuation risk.

Related: Bear Market Singapore, Price-to-Book Ratio (P/B), Dollar-Cost Averaging Singapore, Rebalancing Portfolio Singapore, REITs vs Stocks Singapore.

FAQ — Bull Market Singapore

How is a bull market defined in Singapore?
A bull market is defined as a rise of 20% or more from a recent market trough in a broad market index (such as the STI) sustained over time, accompanied by optimism and rising economic indicators. In contrast, a correction is a 10–19% rise from a trough, and a rally within a bear market (a “bear market rally”) does not qualify as a bull market.
How do Singapore REITs perform during bull markets?
S-REIT performance in bull markets depends on the driver. During low-interest-rate bull markets (e.g., 2009–2015, 2020–2021), S-REITs typically outperform as yield spreads over bonds compress and property values rise. During bull markets driven by economic growth and rising rates, S-REITs may lag as higher rates increase funding costs and compress the yield spread advantage.
What are the risks of investing during a bull market?
The main risk is overpaying. Extended bull markets push valuations above long-term averages — S-REIT P/B ratios above 1.3–1.5x, for example, offer less margin of safety than buying at 0.8–1.0x NAV. Investors also risk abandoning disciplined strategies, taking on leverage, or concentrating in recent winners. Maintaining DCA and periodic rebalancing helps manage these risks.
Should I invest a lump sum during a bull market?
It depends on your timeline and risk tolerance. Research shows that lump-sum investing outperforms dollar-cost averaging in bull markets on average, since markets tend to rise over time. However, for investors who are uncomfortable with the risk of a market correction shortly after investing, phasing in over 6–12 months (DCA) reduces the psychological burden and limits the impact of buying near a top.
How long do bull markets typically last in Singapore?
Singapore bull markets have historically lasted 3–7 years, broadly in line with global cycles, though this varies significantly. The post-GFC global bull market (2009–2020) was exceptionally long. Singapore’s economic sensitivity to global trade and financial cycles means the STI often tracks global markets, with local catalysts (property cycles, banking earnings, REIT sector health) adding Singapore-specific dynamics.